The e-commerce business and intellectual property of RTW Retailwinds were sold at bankruptcy auction Friday to investment firm Saadia Group for $40 million plus assumption of certain liabilities, including honoring gift cards.
To win the auction, Saadia Group doubled the price of a stalking horse purchase agreement offered by Sunrise Brands earlier this month. The new deal must be approved by the bankruptcy judge after a hearing on Thursday, and is also subject to closing adjustments, according to a press release.
Assets include websites run by the apparel company, which was previously known as New York & Co. Those sites include www.nyandcompany.com, www.fashiontofigure.com and its rental subscription businesses at www.nyandcompanycloset.com and www.fashiontofigurecloset.com, per the release.
RTW, a century-old apparel retailer known for much of its life as New York & Co., had been working to close stores and boost e-commerce before it filed for bankruptcy protection in New Jersey last month.
Now with this agreement, e-commerce will be the only thing remaining. RTW CEO Sheamus Toal in a statement said he was pleased "to have received a new, significantly higher priced purchase agreement from Saadia Group," and that it will allow the company to stay in business, if only online.
The pandemic made things harder for the already vulnerable company, as it has for all apparel retailers, but trouble had been brewing for a while as apparel sales have steadily deteriorated in recent years.
This is not the first time Sunrise Brands has missed out at auction. The company tried to buy L Brands' namesake The Limited during its bankruptcy process three years ago, but was outbid by private equity firm Sycamore Partners. Sycamore went on to install it as a private label sold by its Belk department store.
The struggles at New York & Co. and The Limited worsened after those businesses were let go by previous owner L Brands. The apparel conglomerate founded by Les Wexner sold New York & Co. in 2002 after 17 years of ownership. The apparel giant has a track record of ditching clothing brands on the decline, including, most recently, a failed attempt to sell Victoria's Secret earlier this year to Sycamore. Ascena similarly has struggled since acquiring a couple of brands from Wexner's portfolio and is also now in bankruptcy.