Apparel & footwear firm GBG USA files for bankruptcy protection

The Group’s global brand management and Europe wholesale businesses are separate legal entities from GBG USA, not included in this filing and continue to maintain ongoing operations, the company said in a media release.

In conjunction with the filing, GBG USA has entered into an asset purchase agreement (APA) with WH AQ Holdings LLC (as purchaser) and Hilco Brands LLC (as guarantor) (together, the Stalking Horse Bidder), pursuant to which the Stalking Horse Bidder will serve as the stalking horse bidder in a court-supervised sale process for GBG USA’s Aquatalia brand and business. The stalking horse bid provides a purchase price of $17.3 million and the APA is subject to higher or otherwise better offers, among other conditions.

These actions follow the recent sale of the Group’s South Korean Spyder business to Alpha Vista Investment Co, Ltd, the sale of Spyder USA’s inventory and related assets to Liberated-Spyder LLC, and the sale of Frye’s inventory and related assets to ABG Frye LLC.

“We determined that a Court-supervised process to facilitate a sale is the best course of action to maximize 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,” said Rick Darling, chief executive officer of Global Brands Group.

The recent sales of Spyder and Frye’s inventory and related assets provided GBG USA with cash collateral to meet its immediate liquidity needs. This has also reduced the need for supplemental debtor-in-possession (DIP) financing for the Chapter 11 process. GBG USA has further received $16 million in DIP financing from ReStore Capital, LLC to support its additional liquidity needs during the Chapter 11 cases.

Willkie Farr & Gallagher LLP is serving as GBG USA’s legal counsel. Ankura Consulting Group is serving as GBG USA’s restructuring advisor and Ducera Partners is serving as GBG USA’s financial advisor.

Fibre2Fashion News Desk (KD)