True Religion exits bankruptcy, announces reorganization
LA-based denim brand True Religion successfully emerged from Chapter 11 bankruptcy proceedings on Monday, under a court-approved plan of reorganization.
The plan is expected to allow the company to execute upon its growth plans over the next several years, but it does come at a loss.
“Although we had to make the very difficult decision to lower our overall store count and employee base, our successful emergence from bankruptcy as a stronger company is a testament to the contribution of all of our employees throughout the brand’s history,” said CEO Michael Buckley, in a news statement.
“The reorganization has allowed the company to reduce its operating costs and lower its debt load, and emerge a profitable, lean operating company with a healthy balance sheet. The path is now clear for True Religion to continue its reinvigoration of its iconic American brand.”
The iconic apparel brand filed for bankruptcy protection for a second time in less than three years, at the beginning of the Covid-19 pandemic. True Religion listed $100 million to $500 million in assets and liabilities in the court filing dated April 13.
Buckley, a president of True Religion from 2006 to 2010, rejoined the company as CEO in November 2019 to execute the company’s growth strategy.
After it first emerged from bankruptcy in October 2017, True Religion went after a new brand image as a streetwear leader, establishing collaborations with the likes of Bella Hadid and Manchester United.
Backing the denim specialist's reorganization this time around was lender and equity holder Farmstead Capital Management, as well as Crystal Financial, and landlord Simon Property Group.
“We are grateful for the tremendous support and collaboration from Simon Property, Farmstead Capital Management, and Crystal Financial, among others, without whose partnership and belief in True Religion’s prospects we would not be embarking on this exciting next chapter in the company’s journey,” added Buckley.
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