At a German district court in Munich, fashion house Escada filed for insolvency today. The decision came following an insufficient amount of shareholder support for a bond exchange offer that would have restructured the company. Without anymore leads for a financial lifesaving plan, the German house has decided that insolvency, the closest German equivalent to Chapter 11, will have to be the label's fate. Through the process, the filing documents will be reviewed by a judge, who will then appoint an interim insolvency administrator to take over operations. Sadly, about 2,300 employees for the label will be affected by this, with over 600 in Germany. The house has been struggling for months amidst sales losses due to the recession, but just lost more than 70 percent of their value in the last three days, confirming the need for a financial decision to be made.
Article Source: WWD
Photo Soure: thestraitstimes