True Religion Files For Bankruptcy As Amazon Claims Another

Nearly one year after rumors about its upcoming bankruptcy first emerged, overnight US-based denim retailer True Religion Apparel finally threw in the towel when it filed for bankruptcy protection, signing a pre-packaged restructuring agreement with most of its lenders.

True Religion, a company whose denims Reuters says have "gradually fallen out of style", filed for Chapter 11 creditor protection in the U.S. bankruptcy court in the District of Delaware (case Case 17-11463), and listed assets and liabilities in the range of $100 million to $500 million (see full filing below). According to the prepack agreement agreed upon by lenders, including TowerBrook Capital Partners, will slash the company's debt by over $350 million. The jean vendor also said it has secured DIP financing from Citizens Bank for up to $60 million.

True Religion Brand Jeans is pleased to announce it has secured critical stakeholder support for a comprehensive financial recapitalization of the Company’s capital structure. In signing a Restructuring Support Agreement (“RSA”) with the substantial majority of its Term Loan Lenders and its Sponsor, TowerBrook Capital Partners, the Company will reduce its debt by over $350 million and convert it into the substantial majority of the reorganized Company’s equity. To implement the terms of the pre-arranged restructuring expeditiously, the Company filed a voluntary Chapter 11 petition in the United States Bankruptcy Court for the District of Delaware, and expects it will take 90 to 120 days to obtain confirmation of its pre-arranged plan by the Bankruptcy Court. Throughout the implementation of this process, True Religion will continue to operate its business without interruption to customers, employees and business partners.

"After a careful review, we are taking an important step to reduce our debt, reinvigorate True Religion's iconic brand and position the company for future growth and success," True Religion Chief Executive John Ermatinger said in a statement. True Religion also said that critical trade creditors are expected to be paid in full and the company would continue to operate business as usual. The restructuring plan provides for full payment of claims of True Religion's continuing trade creditors, which includes continuing vendors, suppliers and landlords.

The company listed Wachtell Lipton and Pachulski Stang as legal advisors, while financial advisor is MAEVA Group.

For those seeking a culprit for the latest bricks-and-mortar bankruptcy, look no further than Amazon. The denim retailer's financial struggles are due in part to consumer tastes shifting toward online shopping and away from the brick-and-mortar shops and department stores where the company's jeans have been primarily sold.

True Religion said the pre-arranged plan could take about 90 to 120 days to receive confirmation from the bankruptcy court.

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Last October, Reuters reported in October that the retailer had hired a legal adviser to explore several debt restructuring options, as such today's filing should come as no surprise.

Finally, with the True Religion bankruptcy filing, here is the full revised Moody's list of which deeply distressed retailer will likely file for bankruptcy next.

  • True Religion Apparel - men's and women's clothing
  • Boardriders SA  - sporting subsidiary of Quiksilver
  • The Bon-Ton Stores - parent of department store chain
  • Fairway Group Holdings - food retailer
  • Tops Holding II - supermarket operator
  • 99 Cents Only Stores - discount retailer
  • TOMS Shoes - footwear company
  • David's Bridal - wedding dresses and formalwear seller
  • Evergreen AcqCo 1 LP - parent of thrift chain Savers
  • Charming Charlie - women's jewelry and accessories
  • Vince LLC - clothing retailer
  • Calceus Acquisition - owner of Cole Haan footwear firm
  • Charlotte Russe - women's clothing
  • Neiman Marcus Group - luxury department store
  • Sears Holdings - owner of Sears and Kmart.
  • Indra Holdings - holding company owner of Totes Isotoner
  • Velocity Pooling Vehicle - does business as MAG, Motorsport Aftermarket Group
  • Chinos Intermediate Holdings - parent of J. Crew Group
  • Everest Holdings - manages Eddie Bauer brand
  • Nine West Holdings - clothing, shoes and accessories
  • Claire's Stores - accessories and jewelry
  • Gymboree - children's apparel

Comments

Canadian Dirtlump Dubaibanker Wed, 07/05/2017 - 10:36 Permalink

Danier... There's a name I used to see while trolling packed malls as a rubenesque dirtlump. As for TR, they have an outlet at Cross Iron Mills outside of Calgary. I have been considering getting a couple of pairs for old time's sake ( provided I can get a pair that aren't skinny jean baby dick pussy fart panzy ass cut). I guess this means they may be less overpriced when I get around to it.

In reply to by Dubaibanker

Canadian Dirtlump Handful of Dust Wed, 07/05/2017 - 11:12 Permalink

It's somewhat remarkable that the malls in my area are still pretty busy. Granted alot of it appears to be tourist dollars or new canadians with free money dollars.Regarding Amazon though - I've only ever used it a handful of times because Bezos has AIDS as well as the whole retail killing factor. Don't get me wrong, I won't make a difference and we're all fucked at some point. I'll have nice jeans to shit myself in though when it all goes bad.

In reply to by Handful of Dust

Antifaschistische Laowei Gweilo Wed, 07/05/2017 - 11:46 Permalink

completely agree...and don't tell me True Religion wasn't the target of Wall Street/True Religion Insider pump-and-dump schemes for VIPs to make their 100 million dollars off of the back of the ignorant retail investors.    Then...oh, look, an amazon casualty.   bull shit.   easy money from the fed...lost of shiny expansion for the pump.  VIPs making hundreds of millions...etc...THATs the story here.   and I GUARANTEE you the True Religion insiders who got rich off the stock sales....are STILL rich off those stock sales....and the Bankruptcy was baked into the program from day one.....just line them up, because it's the same Wall Street plan for a couple hundred others......and just wait until this game hits the technology sector.

In reply to by Laowei Gweilo

yomutti2 Cloud9.5 Wed, 07/05/2017 - 10:11 Permalink

On this site, I'm pretty sure that ethnic criticism doens't require membership in the target ethnicity. But yeah, with the Latin girls, there is typically a short window between jailbait and whalebait. Maybe Trump should handle the Mexican border question with a hottie visa. You can come in at 18, but you have to go back at 28. Females only. 

In reply to by Cloud9.5

Wahooo Wed, 07/05/2017 - 09:42 Permalink

Lot of consumer brands - and retailers for that matter - don't have online strategies that work. Days are numbered. Others, like Nike, are shifting from brick and mortar to online sales. It's the biggest success factor for this group. We can convert shopping malls to marijuana grow facilities or paintball courses.

HenryKissinger… (not verified) Wahooo Wed, 07/05/2017 - 10:09 Permalink

Lot of consumer brands - and retailers for that matter - don't have online strategies that work. Days are numbered. Others, like Nike, are shifting from brick and mortar to online sales. It's the biggest success factor for this group. We can convert shopping malls to marijuana grow facilities or paintball courses.the rapefugees welfare money seems to be spent on brand new red nike shoes here in EUrope...

In reply to by Wahooo