Bankrupt New York & Company Parent Sells Online Business for $20 Million
RTW Retailwinds is selling its online business.
The fashion group announced today that it has entered into an asset purchase agreement with Sunrise Brands LLC for the sale of its e-commerce platforms and all related intellectual property. The websites to be sold include that of New York & Company (www.NYandCompany.com) and Fashion to Figure (www.FashiontoFigure.com), as well as their rental subscription businesses at www.NYandCompanyCloset.com and www.FashiontoFigureCloset.com.
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The agreement, which is subject to final approval by the bankruptcy court, will cost Sunrise Brands $20 million in cash, plus the assumption of certain liabilities, including the honoring of gift cards, subject to closing adjustments.
“We are pleased to have reached an agreement with Sunrise Brands that will allow our significant e-commerce business to continue to operate and serve our loyal customers,” RTW Retailwinds CEO Sheamus Toal said in a statement. “We thank our associates, customers and business partners for their continued dedication and commitment throughout this process. We are focused on completing this transaction as quickly as possible.”
RTW Retailwinds filed for Chapter 11 protection in mid-July following weeks of speculation amid the coronavirus pandemic. As part of bankruptcy proceedings, the company plans to shut down its entire brick-and-mortar fleet in an “efficient and timely manner,” with New York & Company already hosting going-out-of-business sales at its nearly 380 stores.
According to financial and advisory services firms B. Riley Financial Inc., through its affiliate Great American Group, and Tiger Capital Group, the liquidations are expected to last about eight to 10 weeks or until all products are sold.
“New York & Company offers a versatile array of women’s fashion-wear that is on-trend and stylish at a great value,” Scott Carpenter, president of retail solutions at B. Riley’s Great American Group, said in a statement last week. “We encourage customers to shop early for the very best selection as the store closing sales will last for a limited time only.”
According to its motion, RTW Retailwinds plans to terminate all of its roughly 1,225 workers at the end of the store-closing process. The company received approval for a $1.2 million store bonus program to incentivize employees to stay on through the completion of the liquidation. (They will receive payouts based on 12% of their salaries during the closure period, or 2.5% of their annual salaries, for an average payout of $985.)
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