The Los Angeles-based retail Forever 21 is preparing for a bankruptcy filing as early as Sunday, according to a report Wednesday by the Wall Street Journal.

The Journal, citing unnamed sources, says the retailer is struggling and looking to close up to 700 stores in the near future.

The fast-fashion chain refuted the report.

"The reports are inaccurate; Forever 21 is not planning to file for bankruptcy on Sunday," the company said in a statement to USA Today. "Our stores are open and it is our intention to continue to operate the vast majority of U.S. stores, as well as a smaller amount of international stores."

Bloomberg reported Aug. 28 that the company was preparing for a potential bankruptcy filing as the fashion retailer's cash dwindled and turnaround options faded.

The company has been in talks for additional financing and working with a team of advisers to help it restructure its debt, but negotiations with possible lenders have so far stalled, the Bloomberg story said. Its focus has shifted toward securing a potential debtor-in-possession loan to take the company into Chapter 11, unnamed sources said.

A bankruptcy filing would help the company shed unprofitable stores and recapitalize the business, Bloomberg reported. Yet it could also be problematic for the country's major mall owners, including Simon Property Group Inc. and Brookfield Property Partners LP. Forever 21 is one of the biggest mall tenants still standing after a wave of bankruptcies in the retail sector.

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