True Religion Secures New Financing

True Religion received new financing to fuel future growth.

Counting Second Avenue Capital Partners, a Schottenstein affiliate, TCW Private Credit and Sagard Credit as lenders, the premium denim brand used its new credit facility in part to refinance debt and support fund working capital needs.

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The company, founded in 2002, exited its second Chapter 11 bankruptcy in October 2020 after first going bankrupt in 2017. Today, True Religion seems to be thriving under the leadership of CEO Michael Buckley, who returned in November 2019 after serving as president back in 2010 when premium denim was selling for $300 a pair.

Buckley has been instrumental in transforming True Religion into a denim and lifestyle brand with wider appeal, a move that better served the post-Covid consumer and grew profitability while he shores up the bottom line. And he brought back Zihaad Wells—the two worked together at the company in 2006—as creative director to ensure that True Religion recaptured the identity that once captivated consumers.

The company now has new licensees, such as Concept One Accessories and Capelli/Ballet for cold weather accessories for men’s, women’s and children’s. They also distribute women’s handbags and small leather goods. Another new licensing partner is ENVOGUE, which is helping True Religion launch a home goods expansion early next year. And True Religion is planning to break into China with partner Aurorae Group with 65 freestanding stores and shop-in-shops by 2026. The plan is to grow that to 108 by 2028. The company wants China to drive 10 percent of its global brand volume by 2026.

“This transaction reflects a genuine partnership between our team and the lending group,” Buckley said. Second Avenue, which served in multiple roles including sole arranger, revolver agent and lender, was able to “structure a creative financing solution to meet our needs and support our business objectives to propel True Religion’s growth,” he said.

“The management team’s ability to take what was already an iconic brand and reposition it by leaning into its origins, making True Religion relevant to a new generation, is impressive,” Chris O’Connor, Second Avenue’s president, said. “This transaction underscores our dedication to partnering with dynamic companies to drive value and fuel innovation.”

Second Avenue specializes in asset-based loans for middle-market firms in the retail and consumer products sector. TXW provides senior-secured loans to U.S.-based middle market borrowers, while Sagard provides debt lending options across the credit sector in first and second lien loans for middle-market public and private firms in North America.

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