Pool and spa giant Leslie's filed Chapter 11 this week and will close 76 stores as lenders prepare to take majority ownership under a debt-cutting deal.
Fox Business reported that Leslie's Inc., the largest direct-to-consumer brand in the pool and spa care industry, entered a restructuring agreement with a group of its existing lenders and filed voluntary petitions for prearranged Chapter 11 cases in federal court.
The company plans to keep operating through the case, honor gift cards and loyalty benefits, and emerge in early 2027 under majority ownership of that lender group. About 76 stores will close after management reviewed how the store network lines up with customer demand. Remaining locations stay open.
Shares of Leslie's (LESL) last traded at 15 cents, down 2 cents, or 13.27%, in the quote snapshot carried with the report.
Under the restructuring agreement, Leslie's secured commitments for $90 million in new-money debtor-in-possession financing and $60 million in equity financing. Debtor-in-possession financing is court-supervised lending that keeps a company running while it reorganizes.
The company also filed motions seeking approval of that $90 million facility and a fully committed $225 million debtor-in-possession asset-based facility from its existing asset-based lenders. The package is built to cut roughly $685 million, about 90%, of Leslie's outstanding funded debt.
First-day motions ask the court for routine authority to keep paying wages and benefits, maintain customer programs, and honor vendor obligations. Leslie's says it remains fully operational across its physical stores and digital platforms while it continues evaluating its real estate portfolio.
CEO Jason McDonell framed the filing as a reset, not an exit.
"Today’s announcement marks an important milestone in our commitment to our customers and our business,"
McDonell also said the cleaner balance sheet is meant to fund better execution in stores and online.
"With a stronger balance sheet and greater financial flexibility, Leslie’s can reinvest across the business to strengthen operating execution and deliver an even better experience for our customers, both in-store and online. Leslie’s is here to stay, and I am deeply grateful to our employees, customers, and partners for their continued support as we work to position Leslie’s for a strong future,"
The company did not publish a public list of which 76 locations will close, name the specific federal court, or detail the lender entities beyond describing them as existing creditors. Absolute calendar filing dates were not stated beyond “this week.”
Prearranged Chapter 11 means the company and key lenders already struck the main terms before the petitions hit the docket. That path usually aims for a faster trip through court than a free-for-all bankruptcy fight.
Here, the trade is plain: a massive depreciation of funded debt, fresh operating cash from the same creditor base, and majority equity moving to the lender group when the company exits. Employees are slated to keep regular pay and benefits during the case. Customers are told programs and gift cards still work.
What the filing does not do is shift losses onto taxpayers. Private lenders who extended the credit are the ones converting paper into control and supplying the bridge money. The store footprint shrinks where demand no longer supports the rent and payroll.
Leslie's still has to win court approval for the financing motions, execute the closures, and hit its early-2027 emergence target. The stock price already reflects how thin the equity cushion had become before the petitions.
Heavy debt eventually meets a hard stop. In this case the stop is a courtroom, a smaller store map, and lenders holding the keys, not another public rescue.