Elliott-Backed Claire’s to Defer Interest Payments on Its Debt

Claire’s Stores Inc. is choosing to defer interest payments on its debt as a way to conserve cash as the US-China trade war roils retailer supply chains.

The seller of kitschy tween jewelry plans to pay the interest with additional debt, according to people familiar with the matter, who asked not to be identified discussing a private matter. The arrangement, known as payment-in-kind, is relatively rare but gaining in popularity as high interest-rates keep the cost to borrow elevated.

Messages left with Claire’s weren’t returned.

Claire’s store entrance in Idaho.

Source: Universal Images Group Editorial

Long a mall staple, the Elliott Management Corp.-backed Claire’s, like many retailers, has ...