9 Rhode Island Retailers On Verge Of Bankruptcy, New Moody's Report Says

The ranks of distressed retailers is set to keep growing over the next 12 to 18 months, and nine that have stores in Rhode Island are on the verge of bankruptcy and could be subject to closure, according to a newly-released Moody's Investors Service report.

Overall, 22 national retailers had debt ratings of Caa or lower — higher than the number of bankrupt-leaning retailers during the Great Recession of 2008-2009. Debt rated at Caa or below is the lowest rank on Moody's credit rating spectrum.

Nine of those are in Rhode Island and 17 also have Massachusetts locations, including several in Wrentham.

"The majority of retailers remain fundamentally healthy," Moody's Lead Retail Analyst Charlie O'Shea said in a press release. "But as select groups of retailers continue to deteriorate — in particular department stores and specialty retailers — we believe the distressed ranks will keep growing, fueled in part by distinct vulnerabilities."

Here is the list of retailers with stores in Rhode Island that are on the verge of bankruptcy:

• Charlotte Russe
• Charming Charlie
• Chinos Intermediate Holdings (owns J. Crew)
• Claire's Stores
• David's Bridal

• Evergreen AcqCo 1 LP (owns Savers)

• Gymboree

• Sears Holdings (owns Sears and Kmart)

• True Religion Apparel

The report, "US Retail and Apparel: B2/B3 Issuers Gain Spotlight As Distressed Retail and Apparel Ranks Grow," provides an overview of factors that impact companies at these rating levels.

Some of these retailers, such as Sears and Kmart, have already announced store closings. Earlier this year, Sears announced it would close 150 Kmart and Sears stores by the spring, part of a "difficult but necessary step as we take actions to strengthen the company’s operations and fund its transformation."

Story by Tom Davis. Mike Carraggi contributed to this report.

Photo by Mike Mozart via Flickr