Lucky Brand Dungarees, the American denim and apparel brand part of Authentic Brands Group LLC, has filed for Chapter 11 bankruptcy protection and announced plans to sell the company to SPARC Group, owner of lifestyle brands including Aéropostale and Nautica.
Lucky Brand will be operating during the Chapter 11 process but will permanently close 13 of its extant 200 freestanding stores. It will also continue its activities via e-commerce and wholesale. During Chapter 11, Lucky Brand and its advisors will continue to explore potential sale transactions with other parties to achieve the highest or otherwise best offer.
Matthew A. Kaness, interim CEO and executive chairman, said: "The Covid-19 pandemic has severely impacted sales across all channels. While we are optimistic about the reopening of stores and our customers' return, the business has yet to recover fully. We have made many difficult decisions to preserve the company's viability during these unprecedented times. The board has determined that a Chapter 11 filing is the best course of action to optimize the operations and secure the brand's long-term success. We remain committed to our associates, vendors and business partners and appreciate the continued support through this process."
Lucky Brand has filed a number of customary motions with the US Bankruptcy Court seeking authorization to support its operations during the process, including the authority to continue payment of employee wages and maintain healthcare benefits.
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