Children's Place to Explore Its Options

The retailer said Lehman Brothers will help assist in the review of options, which include potential organizational and operational improvements, a recapitalization or other transactions.

Earlier this month a report surfaced that Children's Place planned to put itself up for sale. The company would not comment on the report at the time.

Children's place has faced a string of negative news recently, beginning in late September when Chief Executive Ezra Dabah was forced out after a company probe found he had violated internal policies for securities trades.

Children's Place also said it is the subject of a class-action lawsuit alleging the apparel company misled shareholders.

In addition, the retailer lowered its outlook for the rest of the year earlier this month, citing a 3 percent drop in September sales at stores open at least a year as well as merchandise margins pressured by high inventory levels. The company also said Deloitte & Touche would step down as its auditor after completing its delayed annual report for fiscal 2006. It delayed filing due to the leadership change.

The company's board of directors has not set a specific deadline for the review's completion.

There is no guarantee the review will result in any changes to the company's current operating or organizational structure or lead to a specific transaction, Children's Place said.