Gérard Darel in receivership

French high-end ready-to-wear brand Gérard Darel has been placed in receivership, with an observation period of four months, leaving open the possibility for a buyout by new investors, sources close to the matter have said.

The insolvency proceedings, which the label itself asked for notably following disagreements with its creditors, was announced this Monday by the Paris commercial court.

Gérard Darel, founded in 1971 and purchased for an estimated value of 300 million euros in 2008 by investment firm Advent, has been facing considerable financial difficulty for several months now.

In August 2014, the commercial court validated an 18-month rescheduling plan for the group's debt, which at the time stood at some one hundred million euros.

Several months ago, the shareholders and creditors began amicable negotiations to attempt to turn around the situation and to find a new solution for the label to be brought back to life.

"The Les parties were not able to agree on a solution, that is why the company's management was asked to be put under the protection of the commercial court," a source close to the matter explained on Tuesday.

"This leaves four months for any possible buyers to manifest themselves," she added.

The French label, whose famous "24 hours" bag was a big hit a few years ago, has 300 stores, half of which are in France, and 1,100 employees around the world.

It generates an annual revenue of around 200 million euros. But the past few years it has been subject to the drop in clothing purchases in France and competition from the new players in its segment of the market.

Advent, which has invested 100 million euros in the company since it acquired it, has put a new management team in place since 2013, entrusting the label's management to Sandrine Lilienfeld and notably to a new designer. An extension towards high-end, especially its most successful accessories segment, and a push towards branching out internationally have been in place since last year.

A savings plan and a reworking of the logistics and information systems were finally established.

According to the source, all of these measures are starting to show results in terms of sales, which could attract new buyers.

"The names of the potential candidates, such as IKKS, Armand Thiery, investment company Borletti and Sandro-Maje have notably been mentioned," said French daily newspaper Les Echos on Monday.