The US arm of Diesel has filed for Chapter 11 bankruptcy protection from creditors, blaming falling sales, high rents, theft and cyber-fraud.
The business, which has filed for protection with the US bankruptcy court in Delaware, will continue to operate throughout the process.
The Diesel parent company is not affected by the bankruptcy.
Diesel said it is addressing “long-term liabilities” to create a “healthier and stronger” US business.
It plans to close some of its 28 stores, refit other shops, and invest in its online and wholesale proposition.
In a statement Diesel said: “The filing is a critical step in enabling Diesel USA to address certain long-term liabilities for a healthier and stronger business in the country, building a dynamic brand presence in line with the evolving US retail environment.
“This procedure opens the way to a redefinition of the brand’s geographic footprint in the United States, a strategic roadmap that will include some important milestones in 2019, such as refitting and reviewing most of its retail store network, and making sure the retail footprint meets the needs of the existing consumer but also of new ones; strengthening its ecommerce presence and redoubling its commitment to innovation; and a series of key wholesale partnerships to give resonance to Diesel’s collections and special products, with tailored buying and distribution activities planned for each.
“The company remains fully committed to the US market, a unique and fundamental window to be an important player globally.”
Diesel USA has been the sole distributor of Diesel products in the US since 1995.