Gymboree is one step closer to bankruptcy

Children’s clothing retailer Gymboree is expected to file for bankruptcy in the coming weeks or even days, after it elected not to make an interest payment on $171 million of bonds that was due on Thursday.

The troubled company, which has been in talks with investment banks and advisers on ways to repair its balance sheet since January, has a three-day grace period before it is officially in default. But it’s expected to announce some kind of prearranged or prepackaged filing in the near term that will allow it to proceed in an orderly fashion, said Reshmi Basu, associate editor of restructuring at Debtwire.

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