NexCen Brands Inc. is moving quickly to see which assets can be shed to raise cash and help it stave off a near-term financial disaster.

Industry sources said Tuesday that home brand Waverly is the first asset NexCen could shed — followed closely by Bill Blass. But sources said Blass would likely go for a “fire-sale” price, given that the turnaround of the long-suffering designer brand is far from complete.

NexCen has to sell assets in order to generate enough cash to meet a $30 million loan payment due in October as part of its acquisition of Great American Cookie. The firm is said to already be in contact with potential acquirers of some of its assets, including investment arms of liquidators.

Apparel sources said there had been one or two inquiries in recent weeks from parties interested in buying the Blass brand, but that NexCen chief executive officer Robert D’Loren wasn’t interested. NexCen paid $54.6 million in a cash-and-stock deal for Blass, and sources said it’s likely to be sold at a substantial discount — perhaps as little as $15 million to $18 million. While new licenses have been signed, those deals are still in their infancy, and there is no assurance consumers will respond to the new lines.

Nevertheless, Blass is seen as the crown jewel of brands in the NexCen portfolio, which stretches from the Athlete’s Foot retail chain to fast-food franchisers. And it is no secret D’Loren holds the asset close to his heart: the ceo has long ties to Blass, including earlier work on the securitization of the fashion house’s trademarks through his former firm UCC Capital. UCC was later merged with Aether Holdings, which later was renamed NexCen.

After NexCen acquired the brand, D’Loren bought a condo in Manhattan and decorated it with Blass-inspired furnishings. In short, D’Loren lived the brand. To sell Blass would be a blow to D’Loren, said sources familiar with D’Loren and the company, but they added that he might not have a choice if it means saving NexCen.

Some industry professionals were surprised at the news Monday that the firm failed to file basic material information required under corporate governance rules outlined by the Sarbanes-Oxley Act. They also point to how D’Loren is known as a micromanager and weren’t sure how the lack of disclosures could have transpired. These individuals also wondered about the company’s auditors and law firms that were involved in the bank financing and speculated whether there had been a major foul-up in some communications.

This story first appeared in the May 21, 2008 issue of WWD. Subscribe Today.

Despite these questions, shareholders have lost their shirts and some lawyers already may be working hard at pulling together shareholder lawsuits. Shares closed up 13.8 percent Tuesday at 66 cents, but this compares with a 52-week high of $13.18.

Roy Jacobs & Associates said that it is “investigating” possible securities violations in connection with NexCen’s announcement. The firm is seeking interested shareholders who purchased NexCen stock from Jan. 30, 2008 to May 16, 2008.

According to a report by Todd Slater at Lazard Capital Markets LLC, NexCen owns seven brands that are generating an estimated $64 million in franchise, licensing and royalty revenue projected for 2008, and controls significant net operating losses that can be used for tax purposes under certain conditions.

While NexCen on Monday raised doubts about its future as a going concern, it can avoid a bankruptcy if it can quickly shed assets to ease its immediate cash flow crunch. One financial source said the lockbox accounts would no longer have any prioritizing effect once the $30 million due in October is paid down, and would thereby ease somewhat the cash flow problem.

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