Global Brands Group North America files for chapter 11
The North American division of Global Brands Group (GBG) has filed for chapter 11, affecting both its wholesale business and certain subsidiaries and affiliates.
The voluntary proceeding was launched in the U.S. Bankruptcy Court for the Southern District of New York where GBG USA listed between 1,000 to 5,000 creditors including top brands such as Kenneth Cole Productions Inc. and Authentic Brands Group, which has owns the likes of Forever 21, Nine West, Eddie Bauer, Juicy Couture, and more.
In conjunction with the filing, GBG USA said that it has entered into an asset purchase agreement for the sale of its Aquatalia brand and business with Windsong Global LLC and Hilco Brands as its stalking horse bidder, providing a purchase price of $17.3 million.
Next, it is also pursuing the sale of a substantial portion of its remaining assets, including Ely & Walker, Airband, MagnaReady, Yarrow, B New York and Juniperunltd.
“Over the past eighteen months the retail landscape has been greatly impacted by Covid-19, creating hardships for us and many others across our industry,” said Rick Darling, chief executive officer of Global Brands Group.
“Our business has also been impacted by ongoing structural shifts in the retail industry, as well as persistent geopolitical tensions that have disrupted supply chains. These factors have been especially detrimental to GBG USA.”
Most recently, the company already made moves to sell brands such as its Spyder business in South Korea, as well as Frye.
“As for GBG USA’s remaining assets, we determined that a Court-supervised process to facilitate a sale is the best course of action to maximise value for all stakeholders and address the financial position of GBG USA and the Group in a fair and transparent manner. GBG USA has compelling brands and products and a highly talented team, and we believe this process represents the best opportunity for GBG USA’s employees and business.”
The group’s global brand management and Europe wholesale businesses are separate legal entities that won’t be affected.
It also filed a number of customary motions with the court seeking authorization to support its operations, including authority to continue payment of employee wages and maintain healthcare benefits and other relief measures customary in these circumstances.
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