David’s Bridal files for Chapter 11 bankruptcy protection

July 2023 | DEALFRONT | BANKRUPTCY & CORPORATE RESTRUCTURING

Financier Worldwide Magazine

July 2023 Issue

As a result of the post-COVID-19 environment and uncertain economic conditions, US bridal-store chain David’s Bridal, LLC and certain of its subsidiaries has filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the District of New Jersey.

The company also expects to file a recognition proceeding in Canada and a subsidiary is expected to commence an administration proceeding for its business in the UK.

Throughout the Chapter 11 process, David’s Bridal stores will remain open, and the company intends to continue operating in the ordinary course, including by fulfilling all customer orders without disruption or delay.

Additionally, the company’s online platforms, including its Pearl platform and vendor marketplace, remain available and accessible to brides for their wedding planning needs.

Furthermore, members of Diamond – David Bridal’s customer loyalty programme – can continue to derive value by earning and redeeming rewards, and the company intends to continue honouring gift cards, returns and exchanges.

To uphold its commitments to customers, employees and partners, the company is seeking customary ‘first day’ relief from the court, including authorisation to continue payment of employee wages and benefits, maintain certain customer programmes and honour obligations to critical vendors.

Prior to filing for Chapter 11, David’s Bridal initiated an evaluation of a wide range of strategic alternatives to maximise value for its stakeholders, including a marketing and sale process for its assets. In light of its liquidity constraints, the company was unable to finalise its marketing and sale process out of court and intends to continue exploring a sale of all or some of its assets.

“Over the last several years, we have taken meaningful strides in our transformation to fulfil the needs of the brides of today and tomorrow,” said James Marcum, chief executive of David’s Bridal. “We have successfully modernised our marketing and customer interaction processes and driven our retail service levels to best in class.

“Nonetheless, our business continues to be challenged by the post-COVID environment and uncertain economic conditions, leading us to take this step to identify a buyer who can continue to operate our business going forward,” he continued. “We are determined to stay focused on our future, because we believe we have an important role in ensuring that every bride, no matter her budget, can have her perfect dress.”

Serving as legal counsel are Kirkland & Ellis LLP and Cole Schotz P.C., with Houlihan Lokey Capital, Inc. as investment banker, BRG as financial and restructuring adviser, Osler, Hoskin & Harcourt LLP as Canadian legal counsel, C Street Advisory Group as strategic communications adviser and Omni Agent Solutions as claims and noticing agent.

“We are grateful to the seven decades of brides and customers who have trusted us with the most special events of their lives, as well as to the dedicated associates and valued partners who make our customers’ dreams come true,” concluded Mr Marcum. “We remain as committed as ever to providing excellent service, delivering for our brides and customers and being part of magical moments.”

Fraser Tennant