2012 April 26
Betsey Johnson LLC Files for Chapter 11
Patrick McMullan View Gallery
(NEW YORK) It's time to bid Betsey Johnson's signature, eponymous line adieu (for now): today, Betsey Johnson LLC, one of the brand's eight licenses, filed Chapter 11. A source close to Johnson tells The Daily that the master Betsey Johnson brand owned by Steve Madden is up 50 percent at wholesale since last year, and deliveries will proceed as scheduled. As for Betsey Johnson LLC, 63 boutiques will shutter over the course of the next few weeks, and approximately 350 jobs will be lost as a result, including some departures as soon as this evening. Several flagship boutiques are expected to remain open. Betsey Johnson LLC has been operated by Boston-based private equity firm Castanea Partners for the past five years.
Since 2010, Steve Madden Ltd. has owned and controlled the Betsey Johnson brand after bailing it out of bankruptcy to the tune of $48.8 million. Madden told WWD that a new apparel license is slated to be inked in the next few days. Johnson will remain onboard as the brand's creative director, helming the moderately-priced Betsey Johnson-branded offshoots including watches, sunglasses, shoes, intimates, swim, lingerie, and beauty.
On May 8, Johnson's company is slated to hit the auction block, per a date requested by Hilco Merchant Resources, LLC, the company tasked with determining a liquidator to facilitate sales at the scores of stores set to close. Those sales will occur from mid-May through July. "Betsey expected this," says our source. Some of the employees let go today are expected to be rehired in the future.
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