Betsey Bankruptcy

BETSEY JOHNSON has filed for bankruptcy protection under the Chapter 11 US Bankruptcy Code. Although the designer will remain creative director of her brand, the majority of its 63 stores and 350 employees will lose their jobs. "The decision to seek protection under Chapter 11 comes after months of rigorously pursuing alternative restructuring arrangements to address Betsey Johnson LLC's cash-flow problems," said the company's LLC chief financial officer, Jonathan Friedman. "After exhausting our resources and possibilities, it became apparent that neither a restructuring arrangement with a new equity investor nor a sale of the business enterprise as a going concern outside of bankruptcy was to be forthcoming. Accordingly, our board made the determination that a Chapter 11 store-closing process will likely be the best way to maximise the value of the company's assets, for the benefit of its creditors."

The label will now focus on Johnson's lower-priced line, but will still stage a catwalk show in September as planned. Johnson, who will be 70 in August, is also involved with a reality television show - which will start shooting in the near future. The company is currently owned by Boston-based equity firm Castanea Partner, who own 90 per cent, and Steven Madden - who holds the remaining 10 per cent stake. "I feel so sad for my store people and all my pink girls," Johnson told WWD. "They live and die for me. But I need to be better. I really need to work well and be more efficient."







ELLA ALEXANDER 27 April 2012
http://www.vogue.co.uk/news/2012/04/27/betsey-johnson-files-for-bankruptcy-protection