Philadelphia-based private equity firm Versa Capital Management has closed a deal to buy teen apparel retailer Wet Seal, which has gone private and filed for Chapter 11 bankruptcy protection in January.
The troubled retailer will continue operating 173 stores and maintain its headquarters in Foothill Ranch in Orange County, California. The retailer had closed two-thirds of its stores before initiating bankruptcy proceedings.
Going private and having the protection of Chapter 11 and now the backing of a private equity firm means that Wet Seal has a fighting chance of coming back, but it will be a uphill climb. The brand is beloved but beleaguered, and the company has a lot of catching up to do when it comes to boosting its e-commerce and moving away from its heavy promotional approach to attracting customers.
"Our goal now is to further implement the strategies we developed," Thomas said. "Those plans call for optimizing the legacy of the Wet Seal brand and strengthening e-commerce as an important source of new customers and sales"