Round-the-clock talks between Kellwood Co. executives and bondholders took on extra urgency Tuesday as the company tried to avoid defaulting on $140 million in notes that mature at midnight tonight.
Sources familiar with the negotiations said St. Louis-based Kellwood was unlikely to make an immediate decision on what action to take in the event of a default, hoping to resolve an impasse with Deutsche Bank, its largest noteholder, and avert a bankruptcy filing.
Deutsche Bank, reversing its earlier support, has remained adamant in its opposition to the proposed exchange offer on the table, even though its representatives were instrumental over the course of a month in negotiating revised note terms. The offer would swap the notes coming due for new ones that extend the maturity to 2014 and include an interest rate almost double the original rate.
Kellwood officials declined comment on the negotiations Tuesday. Deutsche Bank did not return calls seeking comment.
A financial source said if Deutsche Bank walks away and Kellwood is forced into bankruptcy, the German bank may be able to recoup its investment if it has credit insurance to cover the loss. If so, Kellwood would be left with little or no leverage.
However, a bankruptcy filing would leave the other noteholders who have said they would accept the swap in the position of creditors of the apparel firm.
On Monday, Michael Kramer, Kellwood’s president and chief executive officer, said company was “surprised and disappointed” by Deustche Bank’s opposition considering “they were on our bondholder steering committee, helped structure the deal and told us all along that they supported it.” He described Kellwood’s operations as profitable, with positive cash flow, and pledged the company would continue to ship its customers on time.
An affiliate of Sun Capital Partners Inc., Sun Capital Securities Group, acquired the apparel firm for $762 million in February 2008 after a hostile takeover bid.
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews