Claire's Stores

Claire's March 2018 bankruptcy collapsed the teen accessory giant under $2 billion in debt from a 2007 LBO. Apollo Management had paid $3.1 billion, loading Claire's with debt that consumed cash needed for reinvestment. As Claire's aged customers aged out and new teens shopped online, store traffic collapsed. The company emerged from bankruptcy in 2018 with reduced debt but the same fundamental challenge: a declining category with no online moat. Claire's demonstrated that LBO debt transforms cyclical pressure into existential crisis.