The YM Inc. Group of Cos. in Toronto posted a $1.5 million stalking-horse bid for Wet Seal LLC’s intellectual property, according to documents filed today in the United States Bankruptcy Court for the District of Delaware.
YM, which owns 12 Canada-based retail chains including Stitches, Sirens, Urban and Suzy Shier, bid for the Irvine-based retailer’s social media profiles, brands, trademarks, domain names, an e-commerce platform and data on some 5 million customers. It will receive a “break-up fee of 3% of the purchase price…in the event it is overbid,” at the auction scheduled for March 2.
Wet Seal filed for Chapter 11 bankruptcy protection Feb. 2 for the second time, and was taking steps to liquidate its assets—it retained Hilco IP Services LLC to “solicit interest in the IP and conduct bidding and auction process in connection therewith,” while store-closing sales were slated to conclude this week. Some 80 corporate employees were let go on Jan. 27, and the remaining 68 in Orange County may lose their jobs by week’s end, according to sources close to the matter.
“Thanks babe, it’s been real,” Wet Seal said in a message posted on its website. “We hope you had as much fun as we had and are ready for more! ... Continue to check us out and in the coming days we’ll share more on what’s ahead.”
The retailer, which reported 2016 revenue of $144.5 million, had 142 stores in 37 states. It closed 338 underperforming locations and laid off 3,695 full- and part-time employees in January 2015, just before filing for a prior Chapter 11 bankruptcy. It emerged several months later, under the ownership of Philadelphia-based private equity firm Versa Capital Management LLC.