Pacific Sunwear of California Inc. is canceling its asset auction scheduled for today as no bidders, aside from Golden Gate Capital, have come forward.
PacSun filed for bankruptcy protection back in April and at the time, entered into a restructuring plan with Golden Gate Capital. The lender agreed to convert 65 percent of the term loan debt into the equity of the reorganized company and provide a minimum of $20 million in additional capital to PacSun when it emerged from bankruptcy.
June 15 was the deadline for any additional companies to bid on PacSun and none came forward. The auction that would have taken place today was canceled and Golden Gate will now take ownership of the company. Bankruptcy court approval is pending, but likely to be confirmed.
PacSun said in bankruptcy court documents that it was approaching its landlords and requesting rent relief in order to reduce its costs. PacSun has 593 stores and leases cost the company about $140 million a year.
PacSun follows in the footsteps of similar retailers like Wet Seal and Quiksilver that fled for bankruptcy and then were take over by private companies.
Golden Gate Capital is a San Francisco-based private equity firm that holds investments in more than 35 companies across 6 industry verticals. Its other retail holdings include Eddie Bauer, J. Jill, Payless Shoes and Rocket Dog shoes. It also has talent agency Next Model Management in its portfolio.