G+G Retail Inc. Sale May Be Completed on Feb. 14
A Manhattan bankruptcy court may rule on the sale of New York–based juniors chain G+G Retail Inc. as soon as Feb. 14, according sources from the bidding companies.
G+G filed for Chapter 11 bankruptcy in January. On Jan. 30, Foothill Ranch, Calif.–based Wet Seal Inc. bid $15.2 million for G+G, which operates 566 stores under the G+G and Rave nameplates.On Jan. 31, BCBG MaxAzria Group, based in Vernon, Calif., made a counteroffer that involved $15.2 million in cash. BCBG will also deliver to G+G, at closing, a five-year promissory note of $22 million.
Both Wet Seal and BCBG have not made clear their plans for G+G Retail. Retail analyst Jeffrey Van Sinderen considered that Wet Seal, a juniors retail chain that had emerged from its own bankruptcy problems more than one year ago.
“It is indisputable that Wet Seal is a good contender,” Van Sinderen said. “The turnaround in their business was dramatic, and they started to layer on positive comparative sales on top of their positive comps for the last year.”
“BCBG is more of an aspirational brand,” Van Sinderen continued. “The sale may allow them to access more of a lower end demographic.” Van Sinderen is an analyst for Los Angeles–based B.Riley & Co.
Separately, BCBG announced plans to split its collections into two brands, a high-end Max Azria Collections label and a more mainstream BCBG Max Azria line. —Andrew Asch
