Versa Capital Management LLC in Philadelphia has acquired the remnants of Foothill Ranch-based retail chain Wet Seal Inc., according to a report in the Wall Street Journal.
The buy includes $7.5 million in cash for unsecured creditors and the assumption of a $20 million financing commitment from Los Angeles-based investment bank B. Riley Financial Inc., which also has an office in Newport Beach.
B. Riley is in line for a $625,000 breakup fee for the investment bank, which ultimately lost the bidding battle.
Versa will acquire at least 140 stores and invest $10 million into operations, according to the report.
The development comes about two months after Wet Seal filed for Chapter 11 bankruptcy.
Wet Seal currently operates 173 stores in 42 states. It filed for bankruptcy after closing 338 stores and laying off 3,695 full- and part-time employees.
The chain, which was once among the leaders in retail for teens and young women, listed $92.8 million as its total assets and $103.4 million for its total debts as of Nov. 1, 2014.
