US fashion retailer Loehmann's Holdings has filed for Chapter 11 bankruptcy protection for a third time and said it plans to sell substantially all of its assets.
The discount clothing chain filed its bankruptcy petition with the US Bankruptcy Court in Manhattan on Sunday (15 December). The filing revealed the company had between US$50m and $100m in assets, and $100m and $500m in liabilities.
Loehmann's board has hired SB Capital Group, Tiger Capital Group and A&G Realty Partners to handle the sale of the assets. The auction will take place on 30 December, with the deadline final bids set for 27 December.
The filing noted: "In addition to the enormous cash drain that the stores impose on the debtor's limited resources, since the debtor's inventory mainly consists of winter-weather apparel, each bidder would revise its offer downward if the sales do not commence immediately.
"The debtors believe that delaying the sale by only two weeks will lower the sale price by as much as 2% off the potential guaranteed amount paid by the liquidators, equal to approximately $1m of value."
Loehmann's first filed for bankruptcy protection in May 1999. It filed for Chapter 11 again in November 2010 and emerged four months later having successfully completed restructuring of the business.
The retailer was founded in 1921 in Brooklyn, New York, and operates around 40 stores across 11 US states and Washington DC.
