NEW YORK — Teen retailer Clothestime ceased operations early this year, but its new owner says the chain is ready to start ticking again and could actually begin picking off locations from distressed retailers, such as Wet Seal.
“This really is a restart. We plan to open 60 stores between now and January,” said Hillard Herzog, president of Bergamo Acquisition Corp, which bought Clothestime from secured creditor Wells Fargo last April, for an undisclosed price.
Herzog told WWD in an exclusive interview that he’s meeting with bankers representing the troubled Wet Seal chain this week, and that Wet Seal could be ready to give up about 100 stores. Herzog also is eyeing Gadzooks locations, but Wet Seal is his primary focus, he said. He added that Wet Seal has been disposing of some merchandise, which Clothestime is picking up.
Wet Seal’s Peter Whitform, chairman and chief executive, and Douglas Felderman, senior vice president and chief financial officer, could not be reached for comment Monday.
As previously reported, Wet Seal has been struggling to turn around its business and needs cash to keep it afloat. There have been rumors that its Arden B. division is up for sale. Gadzooks filed for bankruptcy last February.
Clothestime once had as many as 550 stores, but when it was purchased by Bergamo, it was down to 224 stores, with about half of them profitable, Herzog said. “We started renegotiating the leases and determined there were probably 80 that were really profitable,” he said.
In two weeks, the first three stores will open, in Bloomingdale and Gurnee Mills, both in the Chicago area, and in Detroit, Herzog said. He added that Clothestimes locations will be in 12 states as well as Mexico.
“We would like to continue the junior apparel look and maybe update it to be more contemporary,” Herzog said. He described the pricing as “not really off-price. I would call it value pricing.”
Key personnel on the Clothestime team include Herzog, president; Sohail Parekh, executive vice president; Michael McHugh, cfo, Renee Rokkas, general merchandise manager, and Michael Mahaffey, who is in charge of store operations.
Previously, Bergamo was primarily involved in importing and wholesaling apparel to such companies as Dillard’s, Federated Department Stores, Ross Stores and T.J. Maxx. Bergamo is based in Corona, Calif., 40 miles east of Los Angeles, and is listed, but not traded yet, on the Nasdaq exchange. Clothestime was founded in 1978. Most locations are 3,500 to 4,000 square feet in size.
“It’s a well-recognized name with a loyal customer base,” Herzog contended.