American children's apparel retailer Gymboree has filed for bankruptcy. The company was hurt by lower-cost competition from rival brick-and-mortar chains. It plans to cut its debt by around a billion dollars and close 375 stores.

Gymboree joins a growing list of specialty retailers and department stores that have closed thousands of locations or filed for bankruptcy this year as consumers shift toward online shopping. San Francisco-based Gymboree opened its first store in 1986 and expanded rapidly, going public in 1993. The chain failed to achieve the levels of growth it had anticipated.

Gymboree's lenders agreed to provide a 35 million dollar loan to finance the company's operations and will invest 80 million dollars in the company when it emerges from bankruptcy. Gymboree expects to move through this process quickly and emerge as a stronger organization that is better positioned in today’s evolving retail landscape. The bankruptcy was widely expected after Gymboree refused to pay some of its bills in recent months, placing the retailer on a collision course with creditors.

In the past year, Sears and Macy's have closed scores of department stores while chains such as The Limited Stores, The Wet Seal and shoe retailer Payless Holdings have filed for bankruptcy.