Toronto-based Mendocino closes stores and files for insolvency

Mendocino Clothing Company Ltd., which operates both Mendocino and M Boutique, is closing storefronts and filing for insolvency in response to the pandemic.

The Toronto-based company has been serving looks to the city since 1987, and will now be moving into the online sphere.

“On July 14, 2020, the Company commenced restructuring proceedings by filing a Notice of Intention to Make a Proposal (“NOI”) pursuant to the Bankruptcy and Insolvency Act (“BIA”),” reads a notice to creditors from KSV Advisory Inc., the brand’s appointed trustee.

“Although the NOI proceeding is pursuant to the BIA, it is important to note that the Company is not bankrupt.”

In addition to filing for insolvency, the document says Mendocino is discontinuing “all or substantially all” store operations, in order to focus on e-commerce.

KSV cites “challenges resulting from the pandemic” as the source of the company’s decision.

While the clothing brand is reportedly not bankrupt, the protection it would gain from filing this NOI would “provide the stability required in order to advance and execute the Company’s restructuring plan,” KSV said.

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Until pandemic-related closures hit the city, Mendocino operated in six locations: 496 Gilbert Avenue; 25 The West Mall (Sherway Gardens); 220 Yonge Street (Toronto Eaton Centre); 2526 Yonge Street; 100 City Centre Drive (Square One); and 2910 Bayview Avenue (Bayview Village).

There are also 17 M Boutique locations across the GTA.