The creditors of the fashion group Gerry Weber have almost unanimously approved an insolvency plan, therefore paving the way for a new start with new owners.
According to Manager Magazin, the financial restructuring of Gerry Weber has overcome a major hurdle: on Wednesday, the creditors of the women's fashion chain almost unanimously agreed to the insolvency plan being proposed in Bielefeld. Consequently, the hedge funds Robus Capital and Whitebox will become the new owners of the company, in exchange for a financial injection of almost 50 million euros.
The existing shareholders, however, oppose the plan but find that they have little choice but to drop it, since the German insolvency court can ignore their objections and allow the plan to be implemented. "Existing shareholders are leaving the company without compensation“ are the words from the company press release itself.
After all, it is expected that the court will give greater weighting to the interests of the company and the creditors, thus rejecting the shareholders' veto. At this point, nothing will then be in the way of the chain relaunching.
This deal also means that the fashion house can continue to operate and restructure under its own management. Gerry Weber was already working on the operational restructuring and repositioning of the group and now there is an ongoing requirement for financial restructuring, added to the fact that the company wants to develop a new concept.
The company's lawyer believes that the insolvency period is almost over, potentially leading to a suspension of the payments period before the end of this year.
Closure of 180 shops
Gerry Weber has been in crisis for years. The group not only suffered from dwindling numbers of in-store customers in city centres, but ran into even greater difficulties due to excessive investments in their own network of stores.
At the beginning of this year, the company was granted a payment postponement. In April, Gerry Weber announced that it would close 180 branches in Europe, 120 of which would be in Germany.