Tamara Mellon LLC, which was hoping for a quick trip through the Chapter 11 process, got an early Christmas present from the Delaware Bankruptcy Court.
An order from U.S. bankruptcy judge Kevin Gross authorized the company to “obtain final post-petition financing and grant security interests” moving things along for the designer, who has partnered with venture firm New Enterprise Associates 15 LP and other lenders for a second go of it. The company was also authorized to enter into an agreement with Seventh Avenue factor Hilldun Corp.
A spokesman for the brand said the company was on track to reemerge around Jan. 15.
Mellon filed for Chapter 11 protection on Dec. 2, having burnt through the $24 million it raised in 2013. Pre-petition, the company owed over $4.1 million.
The designer, cofounder of Jimmy Choo, launched her business with an eye toward “disrupting the traditional fashion calendar and supply chain” through a shop-now, wear-now strategy. The effort may prove to have been somewhat ahead of its time in theory as momentum is building for changes to the established flow in fashion.
In court filings, the company said it needed “additional funding…to accomplish the brand’s goal of becoming a vertically integrated high-fashion e-commerce brand and survive as a viable going concern. Despite its best efforts, TMB has not been able to secure additional funding outside of Chapter 11.”
The new backers plan to pivot and take direct path to the consumer.
New Enterprise will own 31.1 percent of the recapitalized firm while Mellon will own a little more than 16 percent, plus warrants and options.
Mellon was the largest shareholder before the bankruptcy, owning 52 percent of its common stock as well as preferred shares.