FTL SEEKS OK TO SELL GITANO
NEW YORK — Fruit of the Loom Inc. is seeking bankruptcy court permission to sell its wholly owned subsidiary Gitano Fashions Ltd. for at least $2.5 million to One Step Up Inc.
According to court documents, Gitano is a manufacturer of men’s, women’s and children’s apparel, including denim jeans under the “Gitano” trade name.
FTL said that the operation “suffered from an industrywide epidemic of liquidity problems and lagging sales performance.” Liquidity problems kicked FTL into bankruptcy proceedings in December 1999. Included in the Gitano purchase agreement are the Gitano trademark, equipment and inventory.
The proposed sale is subject to court approval and an overbid procedure. A hearing is set for June 8.
One Step Up, a New York corporation, and FTL have also entered into a distribution agreement for the Gitano product. The production plan for Gitano labeled apparel includes the shipment of units to Wal-Mart, Kmart and Ames/Hills stores.