The four-year-old 77kids business is trading hands.
This story first appeared in the August 10, 2012 issue of WWD. Subscribe Today.
American Eagle Outfitters Inc., which decided to get out of the money-losing concept in May, sold the business to Ezrani 2 Corp., a firm formed by Ezra Dabah, the former chairman and chief executive officer of The Children’s Place.
Last year, the 22-door chain wracked up after-tax losses of $24 million on sales of $40 million.
The deal closed Aug. 3 with Dabah buying the chain’s assets, its online business, inventory and a temporary license to use the 77kids name through January. Dabah also assumed liabilities associated with the business and paid American Eagle an amount equal to 65 percent of the cost of the 77kids inventory.
American Eagle, which revealed the deal in a filing to the Securities and Exchange Commission late Thursday, said it expects to take a $35 million loss on the business.
Dabah is also ceo of Nina Footwear Corp.