Ascena retail group an American retailer of women’s clothing, has entered into a restructuring support agreement with over 68% of the secured term lenders and file voluntary Chapter 11 petition to carry out a financial restructuring plan. As per the statement of the company this step aims to protect the business for all stakeholders.

The RSA contemplates agreed-upon terms for a pre-arranged financial restructuring plan that is expected to significantly reduce the group’s debt by nearly $1 billion and provide increased financial flexibility to enable the company to continue its focus on generating profitable growth and driving value for customers and stakeholders.

Currently, the company is operating with approximately 95 percent of its store base reopened and continues to serve customers in those stores and through its e-commerce brand websites.

In addition, Ascena has entered into an asset purchase agreement with City Chic Collective Limited to sell the Catherine intellectual property assets and to transition its e-commerce business to a subsidiary of City Chic. The Company intends to conduct the sale process pursuant to Section 363 of the Bankruptcy Code.