The Walking Company Holdings Inc. has announced that it has obtained critical stakeholder support for a comprehensive recapitalization of the company. The company’s controlling shareholders have committed to invest $10 million in new equity, and it has obtained debtor-in-possession (DIP) financing from it lender, Wells Fargo Bank, for up to $50 million.
With this strong support from its stakeholders, negotiations with the company’s major landlords are already well underway, which will allow the company to rationalize its lease portfolio of mall-based stores, bringing it in line with current market rents. Wells Fargo Bank will provide “exit” financing that, in addition to the company’s ongoing cash from operations, will allow The Walking Company to move forward as a substantially stronger company.
“This recap is the final step in transforming The Walking Company into a more vertically integrated, omni-channel retailer that can not only survive but thrive in the current retail environment,” said CEO Andrew Feshbach. “The Walking Company has been very successful in developing its ABEO brand, which we have integrated with the sale of other leading comfort footwear brands from around the world. We also have made great progress in integrating our mall-based chain with our other channels of distribution, including internet, wholesale sales to independent comfort shoe retailers and international expansion.”
The company expects it will take 90 days to obtain confirmation of its plan by the Bankruptcy Court. The company filed Chapter 11 petitions in the United States Bankruptcy Court for the District of Delaware.
The Walking Company operates 208 stores in premium malls across the nation and the company’s website, www.thewalkingcompany.com.
Photo courtesy The Walking Company
