NEW YORK — Finity Apparel Group on Monday filed a voluntary Chapter 11 petition for bankruptcy court protection in Manhattan.
The better sportswear firm said it plans on restructuring operations. Three other affiliates — GSA Group Ltd., Delta Holdings Inc. and Nanyt Enterprises Inc. — also filed respective Chapter 11 petitions. The main petition lists GSA as the parent company, doing business as Finity Apparel and Finity Apparel Group. Listed as equity shareholders of GSA are Delta Holdings Inc., with 100 shares, and Chinamine Trading Ltd., with three shares.
Jason Tynan, chairman, president and chief executive officer, said in an affidavit filed with the bankruptcy court that the filing was “precipitated by the downturn in the economy and the accrual of losses over an extended period of time.”
He told WWD, “We have made a strategic decision to restructure our U.S. business and consolidate some of our domestic companies. This reorganization will have no effect on our ongoing businesses. We expect it to be business as usual as the company continues to move forward.”
The privately held company, with offices at 525 Seventh Avenue, has inventory and assets located at Distribution Solutions Inc. in Secaucus, N.J.; Red Light Inc. in Los Angeles, and Pacific Connections Inc. in Ontario, Canada. Finity also has piece goods in Central America.
Mahoney Cohen & Co., Finity’s longtime accountants, will continue in that role during the restructuring.
The company, in the court filing, listed total assets at $879,283, and total liabilities of over $10 million. Total current liabilities are $6.5 million, and total loans payable are $11.6 million.
The Chapter 11 petition did not list any retail sites. Back in December 2000, Tynan said the company was in negotiations with an undisclosed retail chain to purchase 18 to 20 stores in the Northeast. The plan had been to convert those sites by early 2001 into Finity stores in an effort to prevent its branded products from falling victim to retailers’ early promotions.
In addition to the contemporary Finity Studio Line, the firm also produces an unconstructed collection called Finity Naturals. At one point, back in 1997, Finity held the Gloria Vanderbilt Apparel Corp. license for career sportswear. As reported, Gloria Vanderbilt was acquired this year by Jones Apparel Group in a deal worth $138 million.
In anticipation of difficult business conditions after last Sept. 11, the company planned to reduce expenses by 12 percent and lay off 20 people.
For spring 2002, Finity’s collection focused less on its earlier flamboyant and glitzy looks and more on a sophisticated approach. To keep prices down, it focused on separates, such as silk shirts and novelty pants.
Among some of the largest unsecured creditors are: Doko America Inc. here, $1.2 million; Worldlink International H.K. Co., Hong Kong, $459,391; USF Worldwide, Springfield Gardens, N.Y., $190,400; Distribution Solutions, Secaucus, N.J., $108,017, and Consorti International Trading here, $99,787.”