A Delaware court judge gave the OK for Quiksilver Inc. to move forward with its plan for reorganization at a hearing today.
The company’s bankruptcy plan went before a judge this morning, with Quiksilver expected to emerge from bankruptcy as a private entity sometime around the week of Feb. 8.
It will be a fresh start for the action sports company, which filed for bankruptcy protection in September after a tough period of business that saw pressures from multiple factors including the pullback in consumer spending during the recession and a continuously evolving competitive landscape that saw market share erode from streetwear and fast-fashion brands.
“Today marks a new beginning for Quiksilver, Roxy and DC Shoes,” chief executive officer Pierre Agnes said. “We will emerge as a revitalized and stronger company with experienced leadership, rationalized operations, a clean balance sheet and a world-class partner in Oaktree, who brings additional strategic and operational expertise to our company.”
Oaktree Capital Management is Quiksilver’s plan sponsor and, along with Bank of America, provided $175 million in debtor-in-possession financing to the firm.
With the plan cleared, it’s now a question of whether the business can be improved.
Quiksilver on Wednesday released results for its fiscal year ended Oct. 31 in which it said it expected net revenue and gross margins to continue to be “unfavorable” over the next few quarters.
Net revenue for the fiscal year totaled $1.35 billion for the 12 months ended in October, down about 14 percent from a year earlier. The company narrowed its net loss during the period to $306.17 million for its fifth straight year of losses.