A shopper walks past a Nine West Group store at the La Cantera outdoor mall in San Antonio, Texas.

Apparel retailer Nine West Holdings and its creditors are close to finishing a deal to restructure more than $1 billion of debt, which includes filing for bankruptcy and divesting parts of the business, Bloomberg reported Wednesday, based on conversations with people familiar with those talks.

This strategy would include asset sales to pay off creditors, where Nine West would seek Chapter 11 court protection and ultimately file for bankruptcy before a March 15 interest payment, the sources told Bloomberg.

Representatives from Nine West and its private equity owner, Sycamore Partners, declined to comment.

Pursuing a Chapter 11 filing would give Nine West more time to repay creditors — an obstacle many private equity-backed retailers, including Payless ShoeSource, Toys R Us and Gymboree, have run into as debts mature.

Nine West is further hampered by the fact it's a decades-old brand operating in the apparel industry, which faces heightened competition from online businesses and fast-fashion retailers such as Zara and H&M.

According to Moody's Investors Service, Nine West doesn't have any debt coming due until 2019, but then the retailer will have to refinance roughly $1 billion.

Bloomberg reported that should this deal go through, Nine West's first-lien lenders would likely be repaid in full, with second-lien lenders receiving equity in the reorganized company, and another smaller piece of equity would go to the company's bondholders.

Read the full report from Bloomberg.