Frederick's of Hollywood seeks Chapter 11 protection against its creditors after closing its lingerie stores, reaching an agreement to sell the company as an online only operation to Authentic Brands Group LLC.
Founded by the inventor of the push up bra, Frederick's of Hollywood has been in the business of selling lacy lingerie and sexy underwear for nearly 70 years. It gained popularity in the 1950's and paved the way for other lingerie companies with the introduction of thong underwear and other ladies' unmentionables.
Although business was booming in its earlier years, Frederick's has had its share of financial troubles. It had filed for bankruptcy in 2001, and has not had a profitable quarter since 2007, blaming its decrease in sales on increased competition from retailers such as Victoria's Secret, and decreased traffic in malls, which housed many of its retail locations.
Fans of Frederick's sexy product line never fear- they will remain in business, as they struck a deal to sell its online operations, inventory, and intellectual property to Authentic Brands Group LLC for $22.5 million and a 25% stake in future revenue. All future operations will remain online, as brick and mortar locations will remain closed.
As in Frederick's of Hollywood and many other cases- bankruptcy does not mean the end. Bankruptcy is a fresh start!
Rebeka Seelinger of Seelinger Law can help you experience debt relief. If you are in trouble with debt collectors or feel bankruptcy may be for you, contact her today for your free consultation to discuss your options and how bankruptcy may be able to help.
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