Sep 3, 2020
Escada files for insolvency for second time
Sep 3, 2020
Luxury brand Escada is insolvent. The German company has opened proceedings at a district court in Munich, it announced on Wednesday. Christian Gerloff has been appointed as provisional administrator.
The bankruptcy filing relates to Escada SE in Germany, and does not apply to other companies in the group.
Management said the business will continue to operate as normal while it undergoes a restructuring process. “We will aim to provide clarity over the future options of the company very soon,” Christian Gerloff said.
The insolvency proceedings affect 180 jobs at the brand’s headquarters and eight stores in Germany.
This is the second time insolvency administrator Gerloff has been called in to support the German fashion brand, having overseen similar proceedings in 2009. At the time, the company was sold to Indian entrepreneur Megha Mittal, who in turn sold the business to US private equity firm Regent in November last year. Upon announcing the acquisition, Regent chairman Michael Reinstein said the partnership would “help take the business to new heights.”
The luxury womenswear label has been struggling with falling sales for years, and the coronavirus pandemic exacerbated the firm’s financial difficulties. Escada no longer releases its financial results. The latest available accounts are for the 2017 financial year, when the company was in the red.
Escada was a top luxury womenswear brand in the 90s, with supermodels including Claudia Schiffer, Linda Evangelista, Cindy Crawford and Naomi Campbell showing its collections.
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