Claire's Accessories files for bankruptcy in the US

Claire's has filed for bankruptcy. The hub for ear piercings at malls across America is the latest retailer to succumb to its massive pile of debt

Claire's, which specialises in ear piercing, fashion jewellery and accessories for young women, is the latest U.S. retailer to run into trouble.

Claire's gave no indication it plans to close any of them.

Claire's Accessories has filed for bankruptcy protection in the USA, in a bid to bring down its debt by $1.9bn (£1.4bn).

The chain has 7,500 stores in total, including four at malls in the Portland area - Lloyd Center, Pioneer Place, Clackamas Town Center and Washington Square.

"The Company's iconic ear piercing services are unmatched and can not be replicated online", Marshall said.

Toys R Us in the United States and the UK announced last week that it would close or sell all its stores after going bust. Those debts cost it $183m a year in interest payments alone.

Members of anAd Hoc Group of First Lien Creditors have agreed to provide the company with approximately $575 million of new capital, including financing commitments for a new $75 million asset-based lending facility, a new $250 million first lien term loan, and $250 million as a preferred equity investment.

Claire's, which is owned by Apollo Global Management, said that when the process is complete in September 2018, it will have more than $150m in cash, and will have brought down its debt burden significantly. Its worldwide subsidiaries are not part of the Chapter 11 filing.

"This transaction substantially reduces the debt on our balance sheet", Ron Marshall, Claire's CEO, said in the statement.

The company announced it will be keeping its stores open and is working to restructure debt.

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