Gerry Weber bought by asset managers, gets almost-€50m cash injection
today Jul 16, 2019
Troubled womenswear giant Gerry Weber said late Monday that it has reached “a milestone for securing the company's future,” with a new deal under which it will be fully taken over and existing shareholders will exit.
The German firm has been battling a weak domestic retail market but also problems with its own ranges not resonating with consumers. It has now unveiled an investment agreement for parent firm Gerry Weber International AG with funds managed by Robus Capital and Whitebox Advisors that will see it getting up to €49.2 million.
The news comes just a week after it said it had sold control of its Hallhuber subsidiary to Robus Capital.
The firm said that the details of the new plan for the company include “a capital reduction to prospectively zero euro, as well as a subsequent cash capital increase. The new shares will be entirely acquired by Robus and Whitebox in a first step.”
And it also said that “due to these measures, the existing shareholders shall leave the company.”
The new “binding agreement” for the firm, which has been operating under self-administered insolvency proceedings, has been approved by the creditors committee and the trustee, lawyer Stefan Meyer.
It means the company will now present an insolvency plan to its creditors “as soon as possible for a vote.”
The almost-€50m refinancing will be used “for the sustainable financial restructuring of” the firm, while the creditors, “waiving parts of their receivables, may, in principle, choose between a cash compensation and various financial instruments for value recovery.”
The firm also said the ongoing implementation of the restructuring “will continue within the interest of the creditors of the company.”
The creditor meeting at which the vote will beheld is expected to happen in Q3 with the aim being “to successfully conclude the insolvency proceedings in late fall this year.”
The transaction remains subject to anti-trust approval, as well as approval of a separate insolvency plan for Gerry Weber Retail GmbH & Co KG, “an essential subsidiary” of the parent company.
The firm added that “a binding agreement within the scope of a comprehensive term sheet was [also] concluded today” for the Retail operation.
Board spokesman Johannes Ehling said: “We are delighted to have found Robus and Whitebox as strong partners with great experience and standing in the fashion industry. For this result, our employees have worked hard in the past months. Today's binding agreements provide clarity and security for our customers, business partners and staff. Now, and with new vigour, we can continue with the further implementation of our operative repositioning and restructuring. With our new collections, we are well prepared for the [tradeshow] CPD this summer.”
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