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The Japan Times reports that Renown Inc. said May 15 it filed for bankruptcy protection after the coronavirus pandemic hit sales sharply in recent months.
Founded in 1902, Renown filed for protection from creditors with the Tokyo District Court under the civil rehabilitation law. It was the first bankruptcy of a listed company in Japan since January 2019, The Japan Times discloses citing credit research firm Teikoku Databank.
Renown was saddled with debts totaling JPY13.88 billion ($129 million), the report notes.
The coronavirus outbreak triggered more than 150 corporate bankruptcies in Japan as of May 15, according to the research firm.
As the spread of the virus has prompted people to stay home, Renown’s sales at retail stores fell 42.5 percent in March from a year before, The Japan Times relates. They plunged 81 percent in April when major department stores, its major sales channels, suspended operations amid the pandemic.
According to the report, the maker of D’urban brand suits posted a net loss of JPY6.7 billion in the March-December period in 2019 after failing to collect JPY5 billion in outstanding debts from a Hong Kong-based affiliate of the Shandong Ruyi group. The Chinese textile group holds a 53 percent stake in Renown.
Renown came under the control of the Shandong Ruyi group in 2010 to restore its financial health.
The Japanese apparel maker once enjoyed brisk sales as the industry leader before the burst of the nation’s asset-bubble economy in the early 1990s.
But it struggled to widen its customer base, including younger clientele, and faced fierce competition from rivals such as Fast Retailing Co., the operator of the Uniqlo clothing chain.
Renown Incorporated (TYO:3606) is a Japan-based company mainly engaged in the textile business. The Company operates in three business segments. The Textile segment is involved in the manufacture, sale, subcontract processing and manufacturing management of textile products, as well as the manufacture of raw materials for its textile products. The Textile-related segment is involved in the inspection, inspection guidance, quality control, quality assessment, logistics and storage of textile products, in addition to the information gathering business. The Others segment is engaged in the design and construction management for shops, the sale of real estate, the insurance agency business, as well as the manufacture and sale of processed food and juices.