One Burnaby store was shut down, but the second is likely to survive.
The future of one of the most iconic fashion brands is looking a little brighter in Burnaby.
Aldo has operated a store in Metropolis at Metrotown for decades, but has been mired in a financial crisis that saw the company close its Burnaby store at Lougheed Town Centre.
Aldo Group Inc. has been stuck in bankruptcy caused in part by the impact that COVID-19 has had on people’s shopping habits.
But now Aldo says its North American creditors have voted in favour of its restructuring plan and settlement, almost two years after the footwear company filed for creditor protection.
The Montreal-based company says the vote is a crucial step in its effort to exit protection under the Companies’ Creditors Arrangement Act.
Some additional legal and administrative steps remain over the next few weeks, including the finalization and approval of an agreement in Switzerland, before the company can completely emerge from court proceedings.
Martin Rosenthal, of the court-appointed monitor E&Y, says it was pleased to find a fair settlement with creditors.
The restructuring proceedings allowed the company to stabilize the business as it underwent a transformation of the organization to focus on profitable core competencies.
CEO David Bensadoun, whose father, Aldo, founded the chain in 1972, has said the impact of the COVID-19 pandemic put too much pressure on business and cash flows.
“Today, after a thorough restructuring process out of which we are announcing our imminent exit, we know that the Companies’ Creditors Arrangement Act was the right path to take to solidify the Aldo Group’s financial foundation and ensure the long-term sustainability of the business,” he stated in a news release.
The retail fashion industry, already undergoing a sweeping shift amid the migration to online shopping, has been hit hard by a pandemic that has shuttered storefronts across the globe and sent apparel revenues plummeting.
- With files from the Canadian Press
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