Gordon Brothers Brands LLC in Boston, a 114-year-old restructuring and investment firm, bought the Wet Seal name and other intellectual property for $3 million in a March 2 auction, according to documents filed in the U.S. Bankruptcy Court for the District of Delaware. The deal was pending final court approval.
“Our plan for Wet Seal is to rebuild and reposition the brand and develop a unique new business model to best position it for future success,” Gordon Brothers President Ramez Toubassy said.
Gordon Brothers bought the Irvine-based retailer’s social media profiles, brands, trademarks, domain names, an e-commerce platform and data on about 5 million customers. Its past investments include Polaroid and Sharper Image.
It beat out Toronto-based YM Inc. Group of Cos.’ stalking-horse bid of $1.5 million. YM eventually made a $2.95 million offer after “20 rounds of competitive bidding,” according to an affidavit filed with the court.
Wet Seal filed for Chapter 11 bankruptcy protection for the second time on Feb. 2 and was taking steps to liquidate its assets—store-closing sales were slated to conclude last week.
It reported 2016 revenue of $144.5 million and had 142 stores in 37 states. It closed 338 locations and laid off 3,695 employees in January 2015, just before filing for the prior bankruptcy. It emerged several months later under the ownership of Philadelphia-based private equity firm Versa Capital Management LLC.
