The sale of the bankrupt national retailer David’s Bridal to Cion Investment Corp. was approved Friday in a Trenton, New Jersey, court hearing.
A spokeswoman for the U.S. Bankruptcy Judge Christine Gravelle confirmed that the motion was granted.
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The 11th-hour deal spared David’s Bridal from complete demise. Executives at David’s Bridal and Cion Investment did not respond immediately to a request for comment Friday afternoon.
Based in Conshohocken, Pennsylvania, and founded more than 70 years ago, the chain had as many as 300-plus stores primarily in the U.S., including select outposts in Canada and the U.K. and franchised locations in Mexico. Once the leading bridal retailer in North America, David’s Bridal was officially shopping for a buyer in February and it filed for bankruptcy in April. The company then announced plans to lay off 9,236 employees — the bulk of its workforce — at that time.
David’s Bridal, which specializes in affordable wedding gowns, accessories, bridal party attire and special occasionwear, saw sales slide due to the pandemic slowdown, the rise of online shopping, inflation concerns, increased competition and some Millennials’ and Gen Zers’ preference for upcycled dresses.
The alliance with Cion was reportedly a no-cash transaction that will enable David’s Bridal to keep 195 stores up-and-running. The sale has reportedly decreased the national chain’s debt from $256.9 million to approximately $50 million. David’s Bridal had a previous bout with bankruptcy in the fall of 2018, when the retailer reached a deal with lenders to reduce its debt by more than $400 million.
Under the new arrangement, roughly 7,000 to 10,000 employees are expected to keep their jobs.
The bridalwear market in the U.S. was estimated to be worth $27 billion in 2022, and accounted for 44.1 percent of the $66.1 billion global market. The wedding industry continues to rebound after the impact of the pandemic shutdown, which reduced wedding parties, postponed and canceled weddings and shrank couples’ budgets. By 2026, the global market is expected to reach $69.9 billion, according to the “Bridal Wear Global Market Trajectory and Analytics” report complied last year by Research and Markets.
The company was said to have signed non-disclosure agreements with 62 potential buyers but only received three offers including the Cion bid, according to a Reuters report citing the court hearing testimony from David’s Bridal’s financial adviser, Surbhi Gupta. The other two bids were only for the intellectual property, according to Adore Bridal & Specialty owner Janice Yoder, who tuned into Friday’s hearing virtually and wrote about it for the National Bridal Retailers Association.
One hundred and five of the 197 existing stores are listed with designation rights, which means the new owner has up to 90 days to take over the lease or reject it. The current executive management team is also expected to remain with the company, according to Yoder.
“Although there were things in the hearing that were shocking to me as an independent bridal store owner, it was clear that there was 100 percent support for this sale even from landlords that initially filed objections. It was also clear that the alternative was absolutely dire. It would have resulted in immediate closures and left employees and brides without even the ability to go through a business closing procedure,” Yoder wrote. “What remains to be seen is how the current executive leadership team plans to lead the ‘New David’s Co.’ into something successful and sustainable that is different from what has happened over the past four years.
In notifying its members of the David’s Bridal sale via email, the National Bridal Retailers Association said, “Although this news may be disappointing for independently owned bridal stores, it serves as a reminder of the importance of focusing on our own businesses and continuing to provide unforgettable experiences for the beautiful brides who choose to say ‘yes’ in our locally owned boutiques.
“While the bridal industry landscape continues to evolve, we have a unique opportunity to showcase the personal touch, expertise and tailored services that set us apart. Our dedication to creating memorable bridal experiences and curating exquisite collections remains unchanged. Let us seize this moment to reaffirm our commitment to growth, innovation and serving our brides with unwavering passion.”
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