Daily Front Row

2010 September 3

Steve Madden Bails Out Betsey

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Betsey Johnson
MARC DIMOV/PatrickMcMullan.com View Gallery

(NEW YORK) Just 10 days before her September 13 show at the Theatre at Lincoln Center, cartwheeling designer Betsey Johnson has defaulted on a $48.8 million loan to her company. Don’t fear, Betsey-philes: the company, which includes ready-to-wear, accessories, and a Betseyville bridge line of accessories, isn’t going anywhere. Steve Madden Ltd. has taken over the loan, leaving Johnson until August 20, 2010 to repay it. According to Women’s Wear Daily, the collateral for the loan includes the company’s intellectual property, as well as “the borrower’s personal property, accounts, deposit accounts and cash, equipment, fixtures, general intangibles, goods [and] inventory.”

This isn’t the beginning of Madden’s involvement with Johnson. The formerly-incarcerated shoe guru already holds licenses for accessories under both the Betsey Johnson and Betseyville brands. However, if the loan is not repayed before the deadline in two years, Madden may control the company. (In 2007, Johnson gave up the controlling stake in her company to a private equity firm, though her daughter Lulu remains the brand’s creative director.)

Johnson launched her eponymous line in 1978 with Chantal Bacon (who remains Johnson’s partner in the company today), and currently operates over 60 stores worldwide.
EMILY GYBEN