With Chapter 11 filings and mass store closures continuing to reshape America’s mall-based retail sector, it’s beginning to feel like old news.

Brands including Altar’d State, Claire’s, Forever 21, and Francesca’s were once staples of local malls, becoming it-hangout spots and go-to destinations for first jobs and putting together the perfect look for school dances. For many shoppers, especially teen girls in the early 2000s, these stores were an essential part of growing up.

Today, many of those same brands are now fighting to survive. Yet in an unexpected turn of events, a longtime mall staple is stepping in to rescue a rival.

Francesca’s receives $7 million bid for intellectual property

Francesca’s has received a $7 million stalking horse bid for its intellectual property (IP) from Altar’d State’s parent company, Stand Out For Good, Inc., following the former retailer’s second Chapter 11 bankruptcy filing.

The proposed deal includes a $210,000 break-up fee and up to $150,000 in cost reimbursements, according to the court filing.

The agreement is subject to bankruptcy court approval. Alternative bids may be submitted until March 5, 2026, with a sale hearing scheduled for March 12.

Stand Out For Good was not the only interested buyer. More than 20 potential purchasers evaluated the opportunity, including 10 that signed nondisclosure agreements and conducted detailed due diligence. Of those, four submitted formal stalking horse proposals.

Founded in 2009, Stand Out For Good operates nearly 180 stores across 38 states under brands including Altar’d State, Altar’d State at Home, Tullabee, AS Revival, Arula, and Vowe’d.

Francesca’s receives a $7 million stalking horse bid for its IP.

Emile Wamsteker/Bloomberg via Getty Images

Why Francesca’s intellectual property matters

While Francesca’s plans to close all 457 remaining stores, its brand still carries value.

Intellectual property, which includes trademarks, customer data, brand recognition, and e-commerce infrastructure, can often be more valuable than physical store footprints.

Acquiring an IP gives buyers full control over the brand’s future use, including relaunching it online, reopening stores, licensing it, or even integrating it into an existing retail platform.

Francesca’s turbulent financial history

Francesca’s financial troubles date back to at least December 2020, when it first filed for Chapter 11 bankruptcy protection, following plans to close about 140 of its approximately 700 locations at the time, according to an SEC filing. The company cited declining sales and reduced foot traffic, challenges intensified by the Covid pandemic.

Tiger Finance, LLC provided Francesca’s with $25 million debtor-in-possession financing facility, allowing operations to continue during the restructuring.

In January 2021, TerraMar Capital and Tiger Capital acquired Francesca’s out of bankruptcy for approximately $18 million under Francesca’s Acquisitions LLC, according to the filing.

MAS Acquisition later took ownership of the brand in September 2024, according to Retail Dive. However, restructuring efforts failed to restore profitability.

Francesca’s filed for Chapter 11 bankruptcy protection a second time in January 2026, reporting assets of $10 million to $50 million, liabilities of $50 million to $100 million, and approximately $30.1 million in secured debt, according to the court filings.

Francesca’s store closures and liquidations

As part of its restructuring, Francesca’s is closing all 457 remaining stores and has launched liquidation sales offering in-store discounts of 25% to 40% across all product categories, according to appointed advisor Tiger Group. The company’s website currently advertises 30% to 50% off storewide.

“This process provides a structured path to pursue the best outcome for all stakeholders,” said Francesca’s CFO Curt Kroll in a press release. “We remain focused on operating responsibly and supporting our teams, partners, and guests throughout this process.”

Women’s Wear Daily (WWD) reported in January 2026 that the abrupt closures and liquidations were due to unpaid vendors.

“The liquidation is believed to include ‘inventory that has not been paid for,'” claimed one of Francesca’s vendors to WWD. “This vendor, who noted that the firm is owed $250 million in unpaid invoices, said that ‘there has been no correspondence whatsoever from corporate to any of the vendors.'”

Mall retailers face similar struggles

Francesca’s is not alone. Several well-known mall-based retailers have recently filed for Chapter 11 bankruptcy and enacted mass closures.

Other retail chains facing bankruptcy and closures

  • Claire’s: Filed for Chapter 11 bankruptcy for the second time in August 2025 and plans to close nearly 300 stores, according to The Street.
  • Forever 21: Filed for Chapter 11 bankruptcy for the second time in March 2025 and liquidated all its U.S. stores to prepare for closures, as reported by The Street.
  • Eddie Bauer: Filed for Chapter 11 bankruptcy in February 2026 and began liquidation sales in about 180 U.S. and Canadian stores, per Fox Business.

For years, declining mall traffic was the excuse for these collapses, but recent data suggest that argument may no longer stand.

Mall traffic is stabilizing, but not all retailers are

Visits to indoor malls grew 1.3% in 2025 compared to the previous year, according to Placer.ai’s December 2025 Mall Index. Shoppers also frequented mass merchants, big-box retailers, and off-price chains at high rates.

“Traffic is up, sales are up, the retailers that don’t make it, even though I could sit here and blame tariffs, you know, they were not highly productive retailers,” said Simon Property Group CEO David Simon in an earnings call. “It’s our view that we can replace it with more productive retailers or higher rents.”

In other words, not all mall-based brands are faltering. It’s only those that failed to adapt.

Broader retail industry headwinds persist

The challenges facing fashion retailers extend beyond foot traffic.

McKinsey & Company’s State of Fashion 2026 Report projects low-single-digit growth for the global fashion industry in 2026. Macroeconomic volatility and tariff pressures are expected to continue shaping value-conscious consumer behavior, particularly in the U.S., where consumer sentiment remained low throughout 2025.

“In the end, 2026 will likely be another year of dislocation for fashion companies,” said McKinsey & Company Fashion Retail Analysts.

Meanwhile, e-commerce continues expanding its share of consumer spending.

With 84.3% of Americans shopping online, U.S. e-commerce spending reached $1.34 trillion in 2024 and is projected to surpass $2.5 trillion in 2030, according to Capital One Shopping.

U.S. online sales accounted for 22.3% of global e-commerce spending in 2024, up nearly 1.5% from the year prior, and are expected to reach $1.47 trillion in 2025.

The convenience, accessibility, and pricing advantages of online platforms have steadily reduced the need for large brick-and-mortar footprints.

“Vacant storefronts are becoming an increasingly common sight, and declining commercial property values are the norm,” said Approved Funding President and Chief Lending Officer Shmuel Shayowitz. 

“And for consumers, the fallout means fewer choices, diminished access to in-person shopping, and, in some cases, higher prices due to reduced competition.”

Related: Why your favorite retail store is going out of business