Dec. 20 (UPI) — The CEO of retailer Party City, which operates more than 700 company-owned and franchise stores across North America, says the company is going out of business, CNN reported Friday,
Barry Litwin told employees in a video meeting monitored by the broadcaster that Party City is “winding down operations immediately” and that Friday would be their last day of their employment.
CNN reported Litwin told staff they will not receive severance pay and would lose their benefits as the stores close down.
“It’s really important for you to know that we’ve done everything possible that we could to try to avoid this outcome,” he said. “Unfortunately, it’s necessary to commence a winddown process immediately.”
Litwin took over as CEO of Party City in August.
The company was founded in 1986 and is North America’s largest party supplies retailer, but was hit hard first by the COVID-19 pandemic and more recently by inflation, resulting in higher costs and lower consumer spending.
Severe financial problems have been ongoing at the New Jersey-based chain for more than two years. It filed for Chapter 11 bankruptcy in January 2023, citing lower sales, liquidity problems and a mammoth debt load.
The subsequent restructuring plan eliminated nearly $1 billion of its debt and resulted in improved lease terms, with less-productive stores shuttered. But in the end, the measures weren’t sufficient to keep the party going.
