David’s Bridal Preparing for Bankruptcy

Wedding dress and supply chain David’s Bridal is expected to file for chapter 11 bankruptcy by the end of next week. However, unlike other recent bankruptcy cases, the business will not be going under entirely. Rather, the bankruptcy will be the prelude to a large-scale financial restructuring process that will, ideally, allow business to continue unchanged.

According to a Bloomberg report, the company is in the process of closing a deal with creditors that would allow most, if not all, of the David’s Bridal locations to remain open and active. Ownership of the company will be passed to Oaktree Capital Group, an investment firm that works with businesses in danger of closing. As part of this acquisition, David’s is hoping to obtain a court order that will allow it to remain open and continue business. According to the company, the intent of this roundabout solution is to ensure that all orders to customers and vendors are properly filled before the end of the post-New Year’s selling season.

At the moment, David’s Bridal currently carries $760 million in debt to its current owner, Clayton Dubilier & Rice. In addition to the order to remain open, the company plans to petition courts for protection from creditors. Despite this odd state of affairs, the company seems optimistic. “Our financial outlook is strong and we have ample liquidity to meet our key business objectives today and in the future,” they said in a statement to Bloomberg. “We do not expect this process to materially impact our business or interfere with day-to-day operations or our relationships with customers and vendors.”

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5 years ago