Leslie’s (NASDAQ: LESL), a nationwide pool supplies retailer founded in 1963, is reportedly preparing to file for Chapter 11 bankruptcy protection as soon as this week, according to reports from Bloomberg and The Wall Street Journal.
Chapter 11 would allow Leslie’s to continue operating while restructuring its debt and business under court supervision. Under the proposed restructuring, according to MSN, a group of lenders is expected to provide approximately $100 million in debtor-in-possession financing to fund ongoing operations, while roughly $750 million in debt would be converted into equity. The restructuring would reportedly transfer ownership of the company to its lenders.
The anticipated filing follows an August regulatory filing in which Leslie’s disclosed substantial doubt about its ability to continue as a “going concern.” The company has faced financial pressure as demand across the pool and spa market has normalized following the pandemic-era surge in backyard spending.
Earlier this year, Leslie’s announced the closure of approximately 80 underperforming stores and one distribution center as part of broader efforts to reduce costs and strengthen its financial position.
As of this publication, Leslie’s has not formally announced a Chapter 11 filing.
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