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Home / Business / Children & # 39; s Place and Gap buys most of what is left of bankruptcy Gymboree

Children & # 39; s Place and Gap buys most of what is left of bankruptcy Gymboree



It is the latest shakeup in the industry that brick and mortar tries to find itself in a challenging environment.

Children & # 39; s Place will spend $ 76 million to acquire the rights to the Gymboree and Crazy 8 brands, and will take over the Gymboree Play & Music contract, which was spun in 2016, according to court records filed Saturday.

Gap seems to go all-in on Gymborees' more upscale Janie and Jack brand. It pays $ 35 million for the online business and leases to Janie and Jack stores.

The movements follow Gymbore's decision in January to become bankruptcy file for the second time in less than two years.

The company unexpectedly said difficult conditions in the brick-and-mortar retail forced them back to bankruptcy. Disappointing sales also led to steep discounts on goods and contributed to Gymboree's problems. It said in January that it would close 800 stores.

The acquisitions from Children & # 39; s Place and Gap, two former competitors, still require legal authorization. None of the companies immediately returned a request for comment on Sunday.

The purchases make sense for Children's Place and Gap because the children's clothing market is flourishing. It grew more than 4% last year.

Many parents choose to have children later in life, meaning they have more disposable income to spend on children's wardrobes, according to Ayako Homma, an analyst who runs the children's clothing market at Euromonitor International.

Gap's decision to summarize Janie and Jack also indicates that the company is planning to build its brand portfolio on the heels of Old Navy spinoff.

The company said last week that it will split into two, separating Old Navy from another business that includes Gap, Banana Republic and other brands, such as Athleta.

The move is designed to let Old Navy expand on its own while the new Gap hones strategy.

Children's Place, meanwhile, pursues a upheaval by pushing online sales and courting Millennial VAT.

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1; CNN Business & # 39; Chris Isidore and Nathaniel Meyersohn contributed to this report.


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