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Broke Brothers - Oldest US Men's Retailer Files Chapter 11 Bankruptcy
The forced work-from-home lockdowns have created an environment where the average working man (or woman or other) in America is now only visible from the shoulder up on his Zoom calls.
This new COVID normal of (in)formal meetings seems to have been the last nail in the coffin of America's most iconic menswear retailers as Brooks Brothers has just filed for bankruptcy (just weeks after Men's Wearhouse owner Tailored Brands considered the same).
A month ago we noted that the 202 year-old clothing retailer Brooks Brothers was in talks with banks about raising financing for a potential Chapter 11 bankruptcy filing amid the coronavirus pandemic, according to a report by CNBC.
Brooks Brothers Chief Executive Claudio Del Vecchio, told The New York Times at the time that while he was not “eager” to consider a Chapter 11 bankruptcy filing, he would not rule it out.
It appears, despite The Fed's massive credit easing, that no one would rescue the oldest men's retailer and the closely-held company, which is owned by Italian businessman Claudio Del Vecchio, filed for bankruptcy protection in Wilmington, Del.
Brooks Brothers was acquired by the British retail chain Marks and Spencer Group PLC in 1988. It was sold in 2001 to Retail Brand Alliance Inc., which was controlled by Mr. Del Vecchio, whose father founded Luxottica Group SpA, the Italian eyeglass maker. It changed its name to Brooks Brothers Group Inc. in 2011.
Brooks Brothers has more than 250 stores in North America and 500 worldwide.
As Fox News notes, Brooks Brothers was facing challenges before the health crisis forced nonessential retailers to temporarily close their stores. U.S. corporations had turned increasingly casual, and fewer men were buying suits. Once people started sheltering at home, they turned to even more casual attire such as sweatpants.
The filing follows other retailers who sell men's workwear (JCPenney, Neiman Marcus, and J.Crew) who have all filed for bankruptcy during the pandemic.
Brooks Brothers is expected to attract buyers, other people familiar with the situation said. Authentic Brands Group LLC, a licensing company that owns the Barneys New York and Sports Illustrated names, is a potential suitor, they said.
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Full Petition PDF https://www.scribd.com/document/468440948/Broke-Brothers-Petition#download&from_embed
Brooks Brothers seeks bankruptcy protection amid pandemic
8 July 2020
]
Brooks Brothers seeks bankruptcy protection amid pandemic
8 July 2020
]
GETTY IMAGES
Brooks Brothers, one of America's oldest clothing brands, has become the latest US retailer to file for bankruptcy protection.
The menswear company, which is more than 200 years old, sought court protection from creditors on Wednesday while it looks for a buyer.
It had already shut some stores and prepared to close its US factories.
Known for its suits, it joins J Crew, JC Penney and Neiman Marcus as a business casualty of the pandemic.
The company dates back to 1818 and its clothes have been worn by dozens of US presidents, including John F Kennedy and Barack Obama.
It operates about 500 stores globally, roughly half of which are in the US, and employs more than 4,000 people.
Since 2001, it has been owned by Italian businessman Claudio Del Vecchio, whose family founded Luxottica. It was owned by Marks & Spencer between 1988 and 2001.
The firm has struggled as more casual office attire has become the norm and online competition has increased. The sale of the business was being explored as a possibility, before the pandemic struck. The company said it expected to complete the process in the next few months.
Classic style
"Industry headwinds were only intensified by the pandemic," Mr Del Vecchio said. "Seeking protection to facilitate an efficient sale of the business is the best next step for the company to achieve its goals, over any other alternative."
Brooks Brothers styles itself as a classic American brand. It taks credit for popularising "preppy" men's staples in the US, including madras prints, seersucker suits, argyle socks and the ever-present button-down shirt.
In a court filing, the company stated that it had both assets and liabilities between $500m and $1bn.
In an interview with the New York Times last month, discussing the three US factory closures, Mr Del Vecchio said the firm was taking steps to ensure its survival. It employed nearly 700 people at the plants in New York, Massachusetts and North Carolina.
In addition, the company had already said it would close 51 stores in the US.
"At this moment, all resources need to be maintained and saved to make sure we can come out on the other side of the crisis," he said.
Brooks Brothers, one of America's oldest clothing brands, has become the latest US retailer to file for bankruptcy protection.
The menswear company, which is more than 200 years old, sought court protection from creditors on Wednesday while it looks for a buyer.
It had already shut some stores and prepared to close its US factories.
Known for its suits, it joins J Crew, JC Penney and Neiman Marcus as a business casualty of the pandemic.
The company dates back to 1818 and its clothes have been worn by dozens of US presidents, including John F Kennedy and Barack Obama.
It operates about 500 stores globally, roughly half of which are in the US, and employs more than 4,000 people.
Since 2001, it has been owned by Italian businessman Claudio Del Vecchio, whose family founded Luxottica. It was owned by Marks & Spencer between 1988 and 2001.
The firm has struggled as more casual office attire has become the norm and online competition has increased. The sale of the business was being explored as a possibility, before the pandemic struck. The company said it expected to complete the process in the next few months.
Classic style
"Industry headwinds were only intensified by the pandemic," Mr Del Vecchio said. "Seeking protection to facilitate an efficient sale of the business is the best next step for the company to achieve its goals, over any other alternative."
Brooks Brothers styles itself as a classic American brand. It taks credit for popularising "preppy" men's staples in the US, including madras prints, seersucker suits, argyle socks and the ever-present button-down shirt.
In a court filing, the company stated that it had both assets and liabilities between $500m and $1bn.
In an interview with the New York Times last month, discussing the three US factory closures, Mr Del Vecchio said the firm was taking steps to ensure its survival. It employed nearly 700 people at the plants in New York, Massachusetts and North Carolina.
In addition, the company had already said it would close 51 stores in the US.
"At this moment, all resources need to be maintained and saved to make sure we can come out on the other side of the crisis," he said.
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