Insolvency proceedings over the assets of Escada AG were opened Sunday at the Munich Municipal court. The label had filed an insolvency petition on Aug. 13.
Now open, acting insolvency administrator Munich attorney Christian Gerloff, has the power of administration and control over all assets and the
power of representation of Escada. Gerloff is reportedly engaged in negotiations with a handful of potential buyers for the fashion house, including
Megha Mittal, daughter-in-law of the Indian steel billionaire Lakshmi
Mittal, and Sven Ley, son of the oiginal Escada founders Wolfgang and Margaretha
Ley. Reports also say the U.S. financial investment firm Oaktree, a
second investment firm and possibly Rustam Aksenenko, once again
Escada’s largest shareholder, are in the final round.
Escada surprised potential investors late last week when it pulled out of the negotiated May sales contract
with Munich-based Mutares AG. The contract involved three of the four Primera brands —
Laurel, Apriori and Cavita. The brands are now supposed to be sold to Endurance
Capital, also based in Munich. A spokesman said the agreement with
Mutares had run into delays brought about by Escada’s insolvency, and
that Endurance Capital had then emerged as a new bidder offering not only better
terms, but an overall better concept for the Primera brands. Mutares had reportedly paid the symbolic price of one euro, or $1.48,
for Primera, and the sale had required a significant writedown in
Escada’s fiscal 2008-09 second-quarter period ending April 30. While
the Escada spokesman wouldn’t disclose the terms of the new deal, he
said Endurance had paid a “recognizable price.” A decision in the insolvency proceedings is
expected as early as the end of this week.
Article Source: WWD
Photo Source: myfashionlife
Tags: Alia Rajput, Apriori, Cavita, Christian Gerloff, Endurance Capital, escada, Escada AG, Insolvency, Lakshmi Mittal, Laurel, Munich-based Mutares AG, Oaktreeinvestment firm, Primera, proceedings, Sven Ley, Wolfgang and Margaretha Ley