March 1 Fashion house BCBG Max Azria Group LLC
filed for bankruptcy protection on Wednesday, the latest
casualty in the struggling U.S. retail sector, as shoppers
abandon malls in favor of internet shopping.
The company, known for party dresses worn by celebrities
including Selena Gomez and Drew Barrymore, listed assets in the
range of $100 million to $500 million and liabilities in the
range of $500 million to $1 billion, a filing under Chapter 11
with the U.S. Bankruptcy Court for the Southern District of New
York showed. bit.ly/2lo7iMI
BCBG Max Group's Canadian affiliate also separately filed
for voluntary reorganization proceedings under Canada's
Bankruptcy and Insolvency Act, the company said in a statement.
The fashion house has received a commitment of up to $45
million in debtor-in-possession (DIP) financing, which will be
used for working capital and to ensure normal operations during
the Chapter 11 process, the company said in a statement.
The company is taking steps to close its freestanding stores
in Canada and consolidate its operations in Europe and Japan,
in addition to the 120 retail stores closed as part of the
Reuters had reported last week that BCBG Max Azria Group was
preparing to file for bankruptcy.
"The steps we are taking now, to address the shift in
customer shopping patterns and the growth of online shopping,
will allow us to focus on our partner relationships, digital,
ecommerce, selected retail locations, and wholesale and
licensing arrangements," Marty Staff, acting interim chief
executive of the company said in the statement.
The reorganization process is expected to be completed
within six months and the stores will remain open during
the process, the company said.
AlixPartners LLP and Jefferies LLC advised the company on
Competing specialty retailers, including The Limited and
American Apparel, have also filed for bankruptcy in recent
BCBG, an acronym for the French phrase "bon chic, bon
genre", a Parisian slang meaning "good style, good attitude",
was founded by Tunisian fashion designer Max Azria in 1989. It
grew through its retail shops and distribution in department
stores including Saks Fifth Avenue and Bloomingdale's.
(Reporting by Vishal Sridhar in Bengaluru; Editing by Amrutha