Fashion footwear company Nine West Holdings intends to file for bankruptcy as soon as This kind of week having a plan to sell the intellectual property of its flagship brand to Authentic Brands Group, people familiar with the matter said on Thursday.
The proceeds through the sale will pay down some of Nine West’s approximately $1.5 billion in debt, increasing the chances that will the company will emerge through a planned bankruptcy, the sources said.
Nine West missed a debt interest payment in March, setting off a 30-day period in which the accessories seller must either make the payment or face bankruptcy.
The company’s creditors plan to take ownership stakes in Nine West’s remaining business, including its denim line sold in mass merchandisers such as Walmart Inc along with Sears Holdings Corp, in exchange for forgiving some of their debt, the sources said.
The sources cautioned that will an agreement between Authentic Brands along with Nine West has not been finalized along with asked not to be identified because the matter can be confidential. Authentic Brands, Nine West along with Sycamore Partners, the private equity owner of Nine West, declined to comment.
Brand licensing firm Authentic Brands recently announced This kind of would certainly buy the sporty Nautica brand through VF Corp along with plans to team up having a partner on the Nine West acquisition, according to the sources.
U.S. retailers are going through a period of upheaval, with more than 15 filing for bankruptcy last year as more shoppers buy online. Nine West competitor Aerosoles Group filed for bankruptcy last year.
Sycamore acquired the Jones Group Inc, then the parent of Nine West, in a deal valued at $2.2 billion in 2014. Sycamore then sold high-end shoe wear lines Stuart Weitzman along with Kurt Geiger, part of the Jones Group.
Some creditors of Nine West plan to pursue claims against Sycamore for the sale of Kurt Geiger along with Stuart Weitzman, the sources said. The creditors will claim that will the divestitures of the shoe companies made Nine West insolvent, the sources said.
Authentic Brands has done business with Sycamore before. This kind of bought the Jones completely new York label through Sycamore in 2015.