Feb 6, 2017
Reading time
2 minutes
Download the article
Click here to print
Text size
aA+ aA-

J.Crew files suit to defend its rights under Term Loan Agreement

Feb 6, 2017

J. Crew announced on Wednesday that it has filed a lawsuit against Wilmington Savings Fund Society, FSB, for disrupting its evaluation of opportunities to enhance its capital structure. The company is seeking a declaration from the New York State Supreme Court, Commercial Division that its actions are in full compliance under the Term Loan Agreement.

J. Crew

The New York City-based company has been proactively exploring opportunities to enhance its capital structure. In December, J. Crew began taking steps to cut its $2 billion debt. According to a press release issued by J. Crew, the company exercised its Term Loan Agreement to provide flexibility with its capital structure. In addition, J. Crew believes that any attempt to challenge its actions is invalid.
"The legal actions we are taking today are aligned with our ongoing efforts to evaluate and pursue opportunities to strengthen our balance sheet as we position J.Crew for long-term growth," said Mike Nicholson, President, COO and CFO, J.Crew Group, Inc. 

J. Crew possesses over $400 million of cash and ABL availability, so it is financially stable and focused on all opportunities to best position its business for long-term growth and success.
The apparel retailer is one of many companies impacted by decreasing mall traffic and increased e-commerce shopping. The J. Crew namesake brand, which contributes most of the company’s revenue, has reported decreases in sales and revenue for multiple consecutive quarters.
Madewell continues to perform well for the company, and has received increased focus in recent years. The brand launched an exclusive partnership at Nordstrom to be carried at numerous stores in the US and online, and it recently launched its ad campaign which can be seen throughout New York City.

Copyright © 2022 FashionNetwork.com All rights reserved.