WASHINGTON — Intensifying the effort to help bankrupt Hartmarx Corp., Capitol Hill lawmakers will urge Treasury Secretary Timothy Geithner to pressure Wells Fargo & Co. to keep the men’s clothing firm afloat until a bidder is approved.
This story first appeared in the May 15, 2009 issue of WWD. Subscribe Today.
Rep. Jan Schakowsky (D., Ill.) said Thursday she and Rep. Phil Hare (D., Ill.), who for 13 years worked in a Hart Shaffner Marx factory in the district he now represents, are gathering signatures for the letter they plan to send to Geithner next week.
They want to enlist Geithner “in getting Wells Fargo to do the right thing and keep Hartmarx open, save 4,000 jobs and send a clear signal to other banks to do the right thing when they face similar situations,” Schakowsky said. “The whole idea of taxpayer help for the banks was to make sure we were not losing these good jobs, these good union jobs.”
The congressional intervention stems from the allegations of union groups that Wells Fargo Foothill/Wachovia Capital Finance, part of the bank group that is providing Hartmarx with bankruptcy financing, is pushing for liquidation of the Chicago-based suit maker.
Wells Fargo has said it is committed to finance the operations of Hartmarx even though the firm has been unable to pay $114 million owed to the bank group. “Despite extensive marketing, Hartmarx has no credible offers to be acquired, but the bank group continues to work with Hartmarx to find potential buyers,” Wells Fargo said this week.
However, Schakowsky and union leaders said there are two viable bidders who deserve the opportunity to purchase Hartmarx. Lawmakers are also angered that Wells Fargo is said to be considering the withdrawal of financing after the bank received $25 billion in federal funds from the Troubled Assets Relief Program.
Schakowsky said she was not aware of any attempts to involve President Obama in the Hartmarx lobbying effort. Obama, who represented Illinois in the Senate before his election to the presidency, wore Hartmarx clothing throughout his campaign and at his inauguration. Neither the Treasury Department nor the White House responded to requests for comment.