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Billion-dollar bankruptcies hit record in 2020 as COVID-19 takes toll

More U.S. companies claimed $1 billion in liabilities in 2020 than in any year since 2009 as the coronavirus pandemic took a toll on businesses and consumers and stifled economic activity.

In total, 44 companies that went bankrupt in 2020 claimed liabilities of more than $1 billion, according to an S&P Global Market Intelligence analysis. That is about 7% of total bankruptcies for the year.

U.S. corporate bankruptcies hit their worst levels in 10 years in 2020 with 630 filings. The coronavirus pandemic was at least partly responsible for many of these business casualties, especially hurting companies that relied on consumer spending and those in the energy industry that suffered a historic downturn in oil prices.

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Energy accounted for most of the large bankruptcies, with 18 filings from companies including Shale pioneer Chesapeake Energy Corp., Oklahoma-based Gulfport Energy Corp. and Texas-based Oasis Petroleum Inc., which emerged from its Chapter 11 bankruptcy in November 2020.

Consumer-focused industries also recorded some billion-dollar bankruptcies. These included the demise of J. C. Penney Co. Inc., which has changed its name to Old Copper Co. Inc. and Ascena Retail Group Inc., which in 2020 sold its Ann Taylor, Loft, Lane Bryant and Lou & Grey brands to an affiliate of private equity firm Sycamore Partners Management LP.

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