US upscale denim brand True Religion has emerged from Chapter 11 bankruptcy following negotiations with its key stakeholders, under a plan of reorganisation approved by a US court earlier this month.
The firm’s re-organisation plan, which gained approval from the US Bankruptcy Court for the District of Delaware earlier this month, allows the California-based denim company to greatly de-leverage its balance sheet, reducing its term loans from US$471m to $113.5mn upon emergence and extending its debt maturities to 2022. Debt Service each year will be substantially reduced, clearing the way for continued investment and company growth.
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“We would like to thank our consumers, our employees, vendors and suppliers for their unwavering support and continued dedication to the True Religion brand,” says CEO John Ermatinger. “With substantial debt burden removed, we are eager to turn our full attention to implementing our forward-thinking strategy, including improving our retail operations, new partnerships and growing the brand’s digital presence.
“With the consummation of this restructure, we are very excited and poised for the future.”
Citizens Bank, which provided $60m in DIP financing, is also providing “exit” funding to the tune of $60m, ensuring the company continues to have ample additional liquidity to execute its growth plan.
True Religion filed for bankruptcy protection in July.
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By GlobalDataTrue Religion files for bankruptcy protection
