The bankruptcy of Global Brands Group (GBG) Holding’s American subsidiary has created tensions amongst Bangladeshi ready-made garment (RMG) manufacturers who supplied their garments to the apparel and footwear wholesaler. As per a Dhaka Tribune report, GBG USA sourced apparels from at least 10 Bangladeshi factories with payments to several of these factories still pending.
The North American division of GBG Holding recently filed for chapter 11 protection in the US Bankruptcy Court of New York, putting its apparel and footwear brands up for sale with help from a $16 million bankruptcy loan, reports the Wall Street Journal. GBG also sourced garments from Li and Fung, another subsidiary of Fung Group and Rising Group, a Mirpur-based BGMEA-listed apparel factory. GBG USA had also ordered products worth $2.4 million in late 2019 from Denim Expert, a Chittagong-based apparel factory. The company had managed to ship the products before the outbreak of COVID-19. But GBG USA delayed taking the products when the pandemic hit the US. Mostafiz Uddin, Managing Director, Denim Expert, says the company’s bankruptcy negatively impacts its supplier factories.
