Brooks Brothers files for Chapter 11 bankruptcy protection
UPDATE (July 12, 2020): After filing Chapter 11 bankruptcy protection, American retailer Brooks Brothers has now managed to secure an $ 80 million loan with zero interest. The loan was provided by ABG-BB LLC, a partnership between Authentic Brands Group LLC and Simon Property Group Inc., which currently competes with WHP Global, a brand buying company that previously offered debtor-in-owner financing. of $ 75 million to the Brooks Brothers.
“I have no doubts that the terms will be the best that can be obtained,” attorney for the retailer Garrett Fail told U.S. bankruptcy judge Christopher Sontchi, who will sign an order authorizing the company to borrow $ 60 million first. US dollars, then to decide on the remaining 20 million US dollars in the coming weeks.
At the same time, Brooks Brothers plans to hold a court-supervised auction for the sale of the company in the near future, which Fail says will attract strong competition: “We have had active discussions with several bidders. “, did he declare.
ORIGINAL STORY (July 10, 2020): After failing to secure offers for a potential sale, America’s oldest clothing retailer Brooks Brothers has now applied Chapter 11 bankruptcy protection, being added to the list of companies that fell due to the coronavirus pandemic.
The filing was filed on Wednesday and notes that the company owes between $ 500 million and $ 1 billion to approximately 25,000 creditors, an amount that includes $ 8 million in unpaid rent, while its listed assets range from $ 500 million. dollars to $ 1 billion. . Brooks Brothers had previously secured US $ 75 million in debtor-in-possession financing to keep its operations afloat during the sale process, which ultimately failed. The brand plans to close 51 of its 250 stores in America and close three factories located in New York State, Massachusetts and North Carolina.
“Our priority is to start this important chapter with a new owner who appreciates the heritage of Brooks Brothers [and] a vision for its future, ”said company CEO Claudio Del Vecchio in a statement.
Brooks Brothers now joins a long list of other clothing retailers who have filed for bankruptcy, including J. Crew, Neiman Marcus and JC Penney.
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