Avenue clothing store files for banktruptcy

Declining sales and expensive store leases led the owner of Avenue plus-size women’s clothing chain to file for Chapter 11 bankruptcy protection Wednesday and agree to be sold to a private equity firm.

New Jersey-based United Retail Group Inc., which operates 433 Avenue stores nationwide, including four in the Dayton area, said Versa Capital of Philadelphia has offered to buy its assets and inventory out of bankruptcy and keep most of the Avenue stores open. Those assets would include its distribution center in Troy, which employs 120 full- and part-time workers.

A spokesman for United said it’s “too soon to know’’ if there will be any layoffs as a result of the bankruptcy filed in New York in which the retailer listed assets of $117.2 million and debt of $67.3 million.

United — which is owned by Redcats USA, a division of French retailer PPR SA — already has begun closing more than a dozen stores and identified at least 100 more that might be shuttered if the retailer can’t renegotiate their leases.

“We are seeking relief from disproportionately high costs for many of our leases that were signed prior to the recession,” United CEO Dawn Robertson said in a statement. “Through Chapter 11 relief and a lease renegotiation process, the turnaround of Avenue can continue.”

The proposed sale to Versa — which is subject to competing bids in the bankruptcy process — was “part of a strategic decision by Redcats USA to focus its business online moving forward,” said John Heaney, Redcats executive vice president.

Redcats, which bought United in 2007, is an online marketer of clothing and home products, including such brands as Jessica London, BrylaneHome and KingSize.

Avenue is a strip-center retailer that sells moderately priced clothing and accessories for plus-sized women under the Avenue brand and shoes under its Cloudwalkers brand.

Contact this reporter at (937) 225-2437 or rtucker@DaytonDailyNews.com.