Phat Fashions “not affected” by Kellwood saga

US: Phat Fashions “not affected” by Kellwood saga

By just-style.com | 22 July 2009

Designer Kimora Lee Simmons has moved to reassure customers that Phat Fashions products will not be affected by doubts over the future of parent company Kellwood.

Apparel group Kellwood has been struggling to repay debt, missing a deadline last week to renegotiate a US$140m bond issue and coming under threat of bankruptcy as a result.

Simmons' Phat Fashions business is one of Kellwood's divisions, but the designer issued a statement denying that brands such as Baby Phat, Phat Farm and Fabulosity will be affected by the situation.

"Whatever course that Kellwood should take, I want to ensure (sic) my consumers and supporters that this will have no effect on our Phat Fashions business," said Simmons.

"All of Phat Fashions products, including Baby Phat apparel, are licensed and manufactured by separate companies operating as licensees, not Kellwood Company, and therefore are operated as independent entities.

"Therefore Kellwood's actions will have no impact on the manufacturing and delivery of our goods. All of our businesses remain strong and Baby Phat has recently expanded internationally into over 100 territories."

Doubts continue about the ability of Kellwood to renegotiate its debt terms, especially a $140m bond which was due for payment on 15 July.

The company is still trying to renegotiate terms with largest bondholder Deutsche Bank, and has negotiated a forbearance agreement with its banking group, led by Bank of America, to allow it to explore ways to strengthen its balance sheet.

Sectors: Apparel, Finance

Companies: Kellwood, Phat Fashions