Claire's: $140M Sale Saves 800+ Stores in 96 Days

On August 6, 2025, Claire's Holdings LLC and thirteen affiliates filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware—the mall accessories retailer's second bankruptcy filing in seven years. The case, In re Claire's Holdings LLC, et al., No. 25-11454 (BLS), came as the brand reported it has pierced more than 100 million ears since its 1978 founding. In his Declaration, Chris Cramer—the company's Chief Executive Officer, Chief Operating Officer, and Chief Financial Officer—pointed to sustained shifts away from brick-and-mortar retail and macro pressures including higher interest rates, labor costs, and tariffs.

The filing followed skipped June and July rent payments and an approaching maturity: approximately $506 million outstanding under the Existing Term Loan Facility, due December 18, 2026. Leading into the filing, the debtors ran a dual-track marketing process—contacting 160+ potential buyers, executing about 60 NDAs, and receiving multiple LOIs—pursuing either a going-concern sale or a liquidation. Ninety-six days later, Claire's emerged from bankruptcy following a $140 million going-concern sale to Ames Watson, preserving 800+ stores and an estimated 17,300 jobs across the U.S. and Canada.

Debtor(s)	Claire's Holdings LLC (14 debtors: Claire's Holdings LLC + 13 affiliates)
Court	U.S. Bankruptcy Court, District of Delaware
Case Number	25-11454
Judge	Hon. Brendan L. Shannon
Petition Date	August 6, 2025
Claims Agent	Omni Agent Solutions, Inc.
Total Funded Debt	~$690.8 million
Plan Type	Liquidating Chapter 11 (363 Sale)
Confirmation Date	October 29, 2025
Effective Date	November 10, 2025
Buyer	AWS Claire's, LLC (Ames Watson affiliate)
Purchase Price	$140 million ($104M cash + $36M seller note)
DIP Facility	$22.5 million (from purchaser)
Stores Preserved	800-950 locations
Jobs Preserved	~17,300 (U.S. and Canada)
Lead Counsel	Kirkland & Ellis LLP
Financial Advisor	Alvarez & Marsal North America, LLC
Investment Banker	Houlihan Lokey Capital, Inc.

The Apollo LBO and Private Equity Legacy

Claire's debt troubles trace back to Apollo Global Management's 2007 leveraged buyout, executed during the pre-financial crisis buyout boom. Apollo acquired Claire's for $3.1 billion while contributing only approximately $595.7 million in equity (per 2013 SEC filings), with approximately $2.5 billion in debt financing. As CNBC documented, the debt burden coincided with a retail shift toward e-commerce and declining mall traffic.

By 2018, Claire's carried over $2.1 billion in long-term debt, leading to its first Chapter 11 filing. The restructuring eliminated approximately $1.9 billion in funded obligations. The 2018 emergence brought new ownership: Elliott Investment Management and Monarch Alternative Capital became the post-restructuring creditors-turned-owners, taking equity positions in exchange for their debt claims. The company filed again in 2025.

Claire's exited its prearranged 2018 Chapter 11 with the debt load eliminated and profitability restored. By 2021, same-store and total net sales, as well as EBITDA, outpaced 2019 and 2020 levels. The company filed for an IPO on September 29, 2021, and withdrew the application in July 2023. The 2025 filing listed total funded debt of approximately $690.8 million:

The Existing Term Loan was scheduled to mature on December 18, 2026. Retail Dive reported tariffs drove an estimated $30 million increase in cost of goods, and the online channel generated a $9 million loss in fiscal 2024.

Corporate Structure and Store Footprint

Claire's operates a global retail platform for jewelry, accessories, and ear-piercing services. The corporate structure includes fourteen debtor entities—Claire's Holdings LLC and thirteen affiliates—with operating subsidiaries handling distribution, retail execution, and intellectual property. Merchandising is broad: each store carries roughly 7,500 stock-keeping units (SKUs) on average. Claire's sources from approximately 250 vendors, most outside the U.S. Purchasing for roughly 45% of North American inventory runs through RSI International Ltd., a non-debtor Hong Kong subsidiary that serves as purchasing and disbursement agent for several debtor and non-debtor entities.

According to CNN Business, Claire's footprint fell from 4,500 global stores in 2018 to approximately 2,750 by August 2025. As of the petition date, the debtors' declaration counted approximately 2,300 company-operated brick-and-mortar stores, roughly 230 franchised locations, and about 9,000 concessions. The C-Club loyalty program had expanded from approximately 5.6 million to 8+ million members during the growth period.

According to WWD's analysis of the dual-track process, 1,119 stores were listed for potential going-out-of-business sales if no going-concern buyer emerged—comprising 1,018 Claire's locations and 101 Icing stores.

Ear Piercing Market Disruption

The competitive landscape shifted in the years leading to bankruptcy. Rowan, founded in 2017 by Louisa Schneider, now operates nearly 100 locations approaching $100 million in annual revenue, with plans to reach 500-1,000 U.S. locations. Rowan uses licensed nurses for all piercings and has occupied former Claire's retail spaces. Studs, targeting an older demographic with an average customer age of 27, operates approximately 40 studios. Co-founder Anna Harman positions the brand against tattoo parlors rather than mall retailers, noting "Studs is in competition with the tattoo parlor".

Traditional retailers also entered the market. Ulta Beauty began offering piercing services across its approximately 1,500 stores in 2021, while Signet Jewelers' Banter chain (formerly Piercing Pagoda) operates over 500 locations. As retail analysts observed, Claire's retained a "slightly childish, 1980s vibe" while competitors like Lovisa offered "a much more contemporary take on jewelry" with sophisticated assortments at value prices.

Claire's does sell online, but its ear-piercing service is in-person and requires trained employees and specialized equipment. As CEO Chris Cramer noted in court filings, the majority of Claire's customers "are young individuals who do not themselves have access to funds, credit cards, or the ability to shop online." Claire's responded to competitive pressure by abandoning piercing guns for hand-pressured instruments and training "certified piercing specialists."

Dual-Track Sale Process

In the run-up to the petition date, Claire's launched a dual-track process to solicit bids for all or part of the business—either as a going concern or via chainwide liquidation. WWD reported outreach to more than 150 potential buyers as the company explored a going-concern sale or liquidation.

As a backstop, the debtors signed a fee-for-service agency agreement with Hilco Merchant Resources, LLC on July 24, 2025, to liquidate all or a portion of U.S. and U.S. territories stores if no actionable going-concern deal emerged. The agreement provided flexibility—subject to lender consent—to pause liquidation should a sale come together.

The Hilco agreement provided a liquidation option while the debtors pursued a going-concern transaction. In the opening days, management aimed to convert one or more non-binding LOIs into binding purchase agreements. Store-closing sales began immediately under the Hilco agreement and pursuant to a consensual cash collateral order with the ABL Lenders and Priority Term Loan Lenders. Because the agency agreement allowed liquidation to pause if a going-concern transaction materialized, the debtors could pursue value on both tracks simultaneously.

The Ames Watson Acquisition

On August 18, 2025—twelve days after filing—the debtors executed an Asset Purchase Agreement with AWS Claire's, LLC, an affiliate of Ames Watson, a privately held investment firm founded in 2018 by Lawrence Berger and Tom Ripley. The sale closed on September 18, 2025.

The transaction delivered $140 million in total consideration: the purchase included $104 million in cash plus a $36 million seller note, subject to adjustments for inventory, accounts receivable, and store cash. The purchaser also provided the debtors' $22.5 million DIP financing facility at 5% interest paid in kind.

The DIP provided liquidity through closing; the lender was the purchaser. Ames Watson operates with annual revenue exceeding $2 billion across a portfolio including Lids, Champion, Mitchell & Ness, and South Moon Under. The firm invests proprietary capital rather than outside investor funds.

"Claire's is one of those rare brands that defines a stage of life," Lawrence Berger stated in the acquisition announcement. Tom Ripley emphasized the human element: "Every turnaround we've done begins with people. Claire's has an incredibly passionate field team—many with 20 years or more in these stores."

The acquisition preserved between 800 and 950 store locations; the liquidation alternative would have closed all 1,500 North American stores by October 2025. Markets including California, New York, Florida, and Illinois retained store presence. According to the Private Equity Stakeholder Project, the transaction preserved approximately 17,300 jobs across the U.S. and Canada.

Employee Treatment and Workforce Outcomes

The bankruptcy impacted approximately 7,000 U.S. employees and roughly 13,000 workers globally, plus 185 independent contractors. Court filings authorized payment of prepetition employee obligations totaling approximately $12.4 million, including $2 million in unpaid wages and salaries and $1 million in withholding obligations.

Under the Ames Watson acquisition, the purchaser committed to extend employment to substantially all store employees at acquired locations and hire a number of headquarters staff. The agreement provided for comparable compensation and credited prior service for benefit plan eligibility and vesting purposes. Ames Watson also agreed to WARN Act compliance for all transferred employees post-closing; the liquidation scenario would have eliminated all 17,300 North American jobs by October 2025.

Plan Confirmation and Creditor Recoveries

The First Amended Joint Chapter 11 Plan was confirmed on October 29, 2025, via cramdown after Classes 5, 8, and 9 (Existing Term Loan Claims, Intercompany Interests, and Equity Interests) were deemed to have rejected the plan. The Effective Date occurred on November 10, 2025—96 days from the petition date.

The debtors established reserves for administrative claims and priority creditors:

Because the confirmed plan is liquidating in nature, the debtors did not receive a discharge of debts. META Advisors, LLC was appointed to administer the Liquidating Trust responsible for pursuing retained causes of action and making final distributions.

Key Objections and Disputes

Multiple landlords objected to proposed cure amounts, arguing they understated accrued interest, attorneys' fees, and post-petition charges. Objecting landlords included Tanger Management Landlords, PREIT Services LLC, Easton Town Center II LLC, West Acres Development LLC, RCM St. George Properties LLC, and Wiregrass SPE LLC.

Notable contract counterparty objections reflected the complexity of assigning 800+ store leases and vendor contracts:

Active litigation included an IP infringement claim by Love and Madness, Inc. (alleged willful post-petition copyright infringement), mechanics liens asserted by Benmoore Construction Group on PA and MA properties, and a personal injury claim by A.L. (minor) related to a pre-petition eye injury from a display rack.

Key Case Timeline

Industry Context and Competitive Dynamics

CEO Chris Cramer cited "increased competition, consumer spending trends and the ongoing shift away from brick-and-mortar retail, in combination with our current debt obligations and macroeconomic factors" as bankruptcy causes. Visits to secondary malls where Claire's is present had waned, while Amazon and online players increased pressure on mall-based retail. NPR highlighted ear piercing as a rite of passage for millions; the service is in-person. Bloomberg pointed to a boom in "trinkets" like Labubu.

Operationally, Claire's manages about 7,500 SKUs per store and sourcing cycles that can take four to six months to manufacture and ship across a mix of core and trend items. Claire's in-store piercing service could not move online during the pandemic, while competitors expanded e-commerce offerings.

Rowan uses licensed nurses for all piercings, occupies former Claire's locations, and targets 500-1,000 U.S. locations. Rowan's CEO stated the company could "easily have upwards of 500, 750, possibly 1,000 locations in the U.S." Market growth was driven by the "ear-scaping" trend of multiple piercings per customer. Studs reported customers averaging 5-9 piercings per visit.

Post-Acquisition Outlook

Ames Watson's investment philosophy—proprietary capital with no outside investors—is described in reporting. The firm's portfolio includes Lids (headwear), Champion (athletic apparel), Mitchell & Ness (vintage sports merchandise), and South Moon Under. The Claire's acquisition adds accessories and ear-piercing retail to that portfolio.

Claire's franchised locations (~230 at filing) and international operations remained outside the bankruptcy sale scope. Several Asian suppliers subsequently alleged they were owed millions in unpaid debts from pre-bankruptcy orders placed under Elliott Management's ownership. The global footprint includes company-operated overseas stores and franchise arrangements. The RSI International Ltd. non-debtor subsidiary relationship handles 45% of North American purchasing from its Hong Kong operations. The company sources from approximately 250 vendors, primarily outside the United States.

Legal Representation

The case was administered before Judge Brendan L. Shannon in the District of Delaware.

Frequently Asked Questions

Who is the claims agent for Claire's bankruptcy?

Omni Agent Solutions, Inc. serves as the claims and noticing agent for the Claire's Holdings bankruptcy cases (Case No. 25-11454, jointly administered in the District of Delaware). The Liquidating Plan was confirmed October 29, 2025, with the effective date occurring November 10, 2025. The Liquidating Trust is administered by META Advisors, LLC.

Is this Claire's first bankruptcy?

No. Claire's filed for Chapter 11 in 2018 after the 2007 Apollo LBO loaded the company with $2.5 billion in debt. The 2018 restructuring eliminated approximately $1.9 billion in obligations. This 2025 filing is the company's second bankruptcy in seven years.

Who bought Claire's out of bankruptcy?

AWS Claire's, LLC, an affiliate of Ames Watson, acquired substantially all of Claire's North American assets for $140 million ($104 million cash plus $36 million seller note). Ames Watson was founded in 2018 by Lawrence Berger and Tom Ripley and operates brands including Lids, Champion, and Mitchell & Ness.

How many stores survived the bankruptcy?

Ames Watson committed to keeping at least 800 stores open, with potential for up to 950 locations. Markets preserved include California, New York, Florida, and Illinois. Without the going-concern sale, all 1,500 North American stores would have closed by October 2025.

How many jobs were saved?

Approximately 17,300 jobs across the U.S. and Canada were preserved through the going-concern sale, including substantially all store employees at acquired locations and headquarters staff.

Why did Claire's file for bankruptcy again?

The company faced a maturity cliff on its $506 million term loan (due December 2026), declining mall traffic, increased competition from specialized piercing studios (Rowan, Studs), tariff-driven cost increases of $30 million, and e-commerce losses of $9 million in fiscal 2024.

What is Ames Watson's track record?

Founded in 2018 by Lawrence Berger and Tom Ripley, Ames Watson operates brands with over $2 billion in annual revenue, including Lids, Champion, Mitchell & Ness, and South Moon Under. The firm invests its own capital rather than outside investor funds.

Did unsecured creditors receive any recovery?

Unsecured creditors faced minimal recovery. A $1 million GUC Reserve was established, but with approximately $78 million in estimated GUC claims, recovery was negligible. The plan was confirmed via cramdown over the deemed rejection by impaired classes.

Who are Claire's main competitors in ear piercing?

Key competitors include Rowan (nurse-based, ~100 locations approaching $100M revenue), Studs (~40 studios, average customer age 27), Ulta Beauty (~1,500 stores offering piercing), and Banter/Piercing Pagoda (500+ locations).

How long did the bankruptcy case take?

96 days from filing (August 6, 2025) to plan effective date (November 10, 2025).

Who provided DIP financing?

AWS Claire's, LLC—the purchaser—provided $22.5 million in DIP financing at 5% interest paid in kind. The DIP lender was the purchaser.

How did Claire's 2018 and 2025 bankruptcies differ?

The 2018 bankruptcy was a prearranged deleveraging that eliminated $1.9 billion in debt while preserving the business as a going concern. The 2025 filing involved a going-concern sale to a third-party buyer (Ames Watson) with store closures. The 2018 case transferred ownership from Apollo to creditors (Elliott, Monarch); the 2025 case transferred ownership to a new strategic buyer.

Why did Elliott and Monarch lose their equity interests?

Elliott Investment Management and Monarch Alternative Capital received equity in Claire's as part of the 2018 restructuring, converting their debt claims into ownership. In the 2025 bankruptcy, all equity interests (Class 9) were canceled without recovery because secured creditors were not paid in full—the standard outcome when liabilities exceed asset value.

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