Wet Seal files for bankruptcy, again
February 3, 2017 01:11 PM
Teen apparel chain The Wet Seal LLC has filed for bankruptcy for a second time.
The company filed on for Chapter 11 bankruptcy protection on Thursday in the U.S. Bankruptcy Court for the District of Delaware, citing assets in the $10,000,001-$50 million range and liabilities in the $50,000,001-$100 million range. Wet Seal, No. 510 in the Internet Retailer 2016 Top 1000, initially filed for bankruptcy in January 2015. Wet Seal generated an Internet Retailer-estimated $27.5 million in online sales in 2015, down 2.0% from $28.1 million in 2014, according to Top500Guide.com.
Court documents for its most recent filing show Wet Seal’s largest creditor is shipping carrier FedEx Corp., to which the retailer owes $608,977. The retailer has enlisted advisory firm Hilco Streambank to sell off its intellectual property assets, which includes its customer data. In the meantime, however, it appears that Wet Seal will continue selling online. The retailer is offering 30% off all merchandise on its site with the disclaimer that all sales are final. A Wet Seal spokeswoman could not be reached for comment.
Wet Seal is the second online retailer in 2017 to file for bankruptcy, following apparel retailer Limited Stores LLC, No. 216 in the Internet Retailer 2016 Top 500 Guide, which filed in mid-January and then shuttered its online operations a week later. Other retailers which have filed for bankruptcy recently include:
- American Apparel Inc. (No. 338), which filed for bankruptcy for the second time in November. Canadian T-shirt and underwear maker Gildan Activewear bought its intellectual property and other assets for $88 million.
- Choxi.com Inc. (No. 48), whose debtors filed an involuntary Chapter 7 petition in November was converted to a Chapter 11 petition in December.
- Nasty Gal Inc. (No. 98) filed for Chapter 11 in November. Web-only online fashion merchant Boohoo.com Plc, No. 166 in the Internet Retailer 2016 Europe 500, announced in December it had entered a purchase agreement for Nasty Gal’s intellectual property and customer database for $20 million.
- Golfsmith International Holdings Inc. (No. 218) filed for Chapter 11 bankruptcy in September. Dick’s Sporting Goods Inc. (No. 62) acquired its assets and intellectual property for $43 million.
- Aeropostale Inc. (No. 154) filed for Chapter 11 in May and was subsequently acquired in September by a group including mall operators Simon Property Group Inc., General Growth Properties Inc., and licensing firm Authentic Brands Group for $243 million.
- Sports Authority (No. 287) filed for Chapter 11 in March. Its name and intellectual property were acquired in June by Dick’s Sporting Goods for $15 million.