Brooks Brothers has succumbed to its debts and filed for bankruptcy in Delaware. The company has entered the process with $75 million in debtor-in-possession financing obtained from WHP Global, the newly formed brand management firm headed by Yehuda Shmidman is among the parties interested in acquiring the business. Brooks’ largest creditor is Swiss Garments Co, which is owed $5.2 million. The company listed both its assets and liabilities as ranging between $500 million and $1 billion.
The group aims to start this important chapter with a new owner that has appreciation for the Brooks Brothers legacy, a vision for its future, and aligns with our core values and culture. Prior to COVID-19, it was already evaluating various options to position the company for future success in a rapidly transforming retail environment, including a potential sale of the business. Industry headwinds were only intensified by the pandemic. Seeking protection to facilitate an efficient sale of the business is the best next step for the company to achieve its goals, over any other alternative.”
Brooks Brothers will commence a competitive auction where parties can submit qualified bids and the sale process is expected to be completed within the “next few months, pending court approval. Until that time, the company will continue to operate its business and will continue to examine the reopening of stores that have been closed since March due to the coronavirus pandemic.