Bankrupt Hartmarx Corp. is seeking a six-month extension of its exclusive right to file a plan of reorganization as bankers continue to finalize a two-party bid for the firm that has a cash value of $70 million.
Chicago-based Hartmarx, which filed for Chapter 11 bankruptcy court protection on Jan. 23, has until May 23 to file its reorganization plan. The extension, if granted, would give the distressed firm an additional 180 days, or until Nov. 23, to file a plan, and next Jan. 22 to solicit creditors’ approval.
Hartmarx also is seeking a three-month extension, until Aug. 21, for when it has to decide which leases to assume or reject.
Sources said Hartmarx bankers are continuing to cobble together a combined “stalking horse” offer from two bidders. The plan would have the firm’s assets split up between New York-based Mistral Equity Partners and Los Angeles-based Yucaipa Cos.
Sources familiar with the process said the $70 million amount on the table likely would give creditors a return of just pennies on the dollar.
These sources said the new bid requires another round of due diligence, which could lower the cash consideration as inventory and asset valuations typically decline over time. In addition. Yucaipa is said to require financing to get the deal completed.
Wells Fargo Foothill/Wachovia Capital Finance, part of the bank group that is providing Hartmarx with bankruptcy financing, has been under fire from union groups alleging the bank is pushing for liquidation of the Chicago-based manufacturer. Wells Fargo pointed out it has continued to finance the operations of Hartmarx, even though, it says, Hartmarx has been unable to repay more than $114 million owed to the bank group. According to Wells Fargo, “Despite extensive marketing, Hartmarx has no credible offers to be acquired, but the bank group continues to work with Hartmarx to find potential buyers.”
Sources close to London-based Emerisque, which let its bid expire, do not expect the firm to step back into the bidding process.
Meanwhile, another voice joined the growing chorus of lawmakers demanding that Wells Fargo allow Hartmarx to be sold to a viable buyer. Demanding that the bank avoid liquidation, Sen. Charles Schumer (D., N.Y.) sent a letter to John Stumpf, chief executive officer of Wells Fargo, on Tuesday urging the bank to “select a bid for the company that would keep it operating and allow it to come out of bankruptcy intact and operational, preserving some 600-plus jobs in Rochester and scores more in Buffalo.”
In a separate move, the Service Employees International Union and Workers United, which represents Hartmarx, plan to launch a “Keep America Working” hotline and new Web site today to help “workers and small business owners to preemptively protect jobs in our communities and hold taxpayer-financed banks accountable for actions that undercut a meaningful economic recovery.”
“My personal philosophy to beauty is paying attention to oneself. I love to be outdoors, lots of fresh air, trying to take care of yourself as best you can. I always notice that comes through,” says Felicity Jones, the global face of @shiseido-owned @cledepeaubeauteus, which launches today. Head to WWD.com to read more about the actress’ love for beauty and how she prepared for her new role in “The Basis of Sex,” playing the young Ruth Bader Ginsburg. #wwdbeauty (📷: @dandoperalski)
For men’s fall 2018, @giuseppezanotti drew on elements from streetwear, sport, biker, combat and rock ‘n’ roll. Pictured here are a pair of shoes from the collection, featuring zippers, rhinestones, and silver hardware. Head to WWD.com to see a roundup of the accessories from Milan’s men’s fall 2018 shows. #wwdfashion (📷: Andrea Delb)
To celebrate the 25th anniversary of @ralphlauren’s snowboarding collection, the brand is mining its archives. The iconic brand is reintroducing vintage styles and dropping new designs for a color capsule that will be available in Ralph Lauren stores and @openingceremony on January 25. The capsule will consist of 10 pieces, including the Snow Beach Pullover, pictured here, which is a collector’s item that rapper Raekwon wore in Wu-Tang Clan’s “Can It Be All So Simple” video. #wwdfashion (📷: Tom Gould)
For @rochasofficial’s pre-fall 2018 collection, creative director Alessandro Dell’Acqua channeled the sophisticated and intriguing Catherine Denevue in the film “Belle de Jour.” Polished collarless coats, midi skirts, suits and ’60s graphic motifs were all featured in the collection, adding a sense of discreet luxury. See the rest of the photos on WWD.com #wwdfashion
“We tried to produce clothing of that couture quality, but the most daunting part was that we only had a matter of days [to do it],” said costume designer Lou Eyrich, who recreated Gianni Versace’s iconic looks for @americancrimestoryfx. Eyrich searched online retailers and vintage shops for original pieces from the design house and for @penelopecruzoficial, who plays Donatella Versace. Head to WWD.com to read how she created the Versace world. #wwdfashion
Only three months after her stellar debut catwalk season, @kaiagerber has inked her first big design collaboration –– with @karllagerfeld. The collection blends Lagerfeld’s Parisian chic aesthetic and the model’s signature West Coast casual style via RTW, accessories, footwear and more. The #KarlLagerfeldxKaia collection will launch in September with a series of events. Get all the details on WWD.com. #wwdnews #wwdfashion
Harrods plans to remove the famous statue of Princess Diana and Dodi Al Fayed from the bottom of the Egyptian escalators and hand it back to Mohamed Al-Fayed. “We are very proud to have played our role in celebrating the lives of Diana, Princess of Wales and Dodi Al Fayed at Harrods and to have welcomed people from around the world to visit the memorial for the past 20 years,” said Michael Ward, Harrods managing director. “With the announcement of the new official memorial statue to Diana, Princess of Wales at Kensington Palace, we feel that the time is right to return this memorial to Mr. Al Fayed and for the public to be invited to pay their respects at the palace.” More on the news, with reporting by @loreleimarfil, at WWD.com. #wwdnews