Bankruptcy Leads to New Owner for G-Squared
Nearly three months after filing for Chapter 11 bankruptcy protection, G-Squared Fashion Inc. has been sold for $550,000.
G-Squared—a Los Angeles company that makes juniors apparel for major department stores under the Yank, Seleacute;, and Taylor and Hyde labels—filed for bankruptcy protection on Nov. 24, 2008.
Initially, the company, founded in 2004 by Gregg Fiene, listed its debt with the U.S. Bankruptcy Court in Los Angeles as $19 million.
The troubled apparel maker was purchased on Feb. 4 by William Sung of Sand K. Inc., a sweater manufacturer in Santa Fe Springs, Calif. Sand K. was a sweater licensee for G-Squared and has its own sweater labels, including Bette Paige and Bette Sung. The purchase price included taking control of G-Squared’s labels but did not cover any liens, claims or encumbrances. Fiene will work as an employee with the new ownership.
First Capital, the factor for G-Squared, was one of the major creditors and was in court to make sure it was paid $530,000 from the $550,000 purchase price.
G-Squared was founded by Fiene and Greg Walker. Walker was the chief executive until July 2008, when he left, making Fiene both president and chief executive.
G-Squared grew fairly rapidly after its launch in 2004. Revenues reached $13 million in 2006, $21 million in 2007 and $18.7 million for the first 11 months of 2008.
When asked what happened, Fiene said it was “due to the cost of business and money pressure.”
Fiene is a long-time apparel maker. He was the founder of juniors apparel label XOXO, which debuted in 1991. The label was quite successful and was sold eight years later to Aris Industries Inc. in New York for $25 million plus stock options. —Deborah Belgum
