The British beauty and cosmetics brand The Body Shop has ceased operations and is closing many stores in Canada after filing for bankruptcy.
Store Closures in the Next Five Weeks
According to a court filing, the store closures are spread across cities such as Toronto, Ottawa, Edmonton, Calgary, Saskatoon, and Saint John. The company is indebted to unsecured creditors for over three million three hundred thousand dollars and to secured creditors for approximately $16,400.
On Friday, the Body Shop Canada announced that its US division has halted operations. This decision follows the recent filing by the company's parent, The Body Shop International Ltd., in the UK for administration, a legal procedure enabling companies to reorganize or cease operations without immediately settling their debts.
A spokesperson for FRP, the administrators hired by The Body Shop International, announced on Monday that they also plan to close 82 out of 198 stores in the UK, which are scheduled to happen within the next five weeks.
FRP does not manage The Body Shop's US or Canadian branches. A spokesperson for The Body Shop North America did not respond for more details on Monday.
British media outlets reported that 75 of the brand's stores in the UK would shut down, and approximately 40% of its headquarters staff would face layoffs.
In Canada, the company aimed to retain most of its stores and expressed in a statement its desire for "breathing room" through Ontario court proceedings. At the same time, it assesses strategic options and implements restructuring efforts.
The Body Shop's Chapter 11 Filing
In a March 1 announcement, The Body Shop Canada stated that it filed for a notice of intention under Canada's Bankruptcy and Insolvency Act to pause its parent company's administration proceedings in the UK and allow time for evaluating strategic options and implementing restructuring measures.
At that time, The Body Shop Canada mentioned that all of its 105 stores were still operating, but 33 stores were closing, and the online sales through Canada's e-commerce platform discontinuation would happen soon, although the details regarding when the closures and liquidation of US locations were not given immediately.
The Body Shop's Legacy
The Body Shop, founded in 1976 by Anita Roddick and her husband, was known for selling soaps, creams, and makeup. As stated in the announcement, it describes itself as a formerly pioneering beauty brand recognized for its cruelty-free heritage and ethical beauty products.
The brand gained immense popularity in the 1980s after being listed on the London Stock Exchange and expanding globally. It now has stores in about 80 countries, including many run by franchisees.
Roddick and her husband sold The Body Shop to L'Oreal in 2006, which was later acquired by Brazilian cosmetics Natura in 2017. Last year, it was sold to Aurelius, a private equity firm specializing in revitalizing struggling companies, in a two hundred sixty-one million dollars deal. By 2023, the company had grown its presence to 2,500 retail locations, including owned and franchised outlets in more than 80 countries.
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