Loehmann's back and ready to nab the frugal fashionista
NEW YORK -- Loehmann's has emerged from Chapter 11 bankruptcy and is ready to position itself has the destination for top designer clothing for less. The company said it will focus its merchandising strategy on well-known designer brands that resonate with its frequent shoppers. The company has also refined its advertising outreach to communicate with Loehmann's core customers and potential new shoppers. This marketing strategy is evident in recent TV spots, which feature female shoppers bragging about the great deals they got on designer clothing and accessories. The catch is that the actual designers are bleeped out, so curious viewers have to visit the stores to see what sort "steals" they can find.
Loehmann's Holdings said it emerged from Chapter 11 bankruptcy proceedings on March 1. The company secured $45 million in exit financing from Wells Fargo Bank, N.A. and Whippoorwill Associates Inc., as agent for its discretionary funds and accounts. In a press release, the company said that its reorganization plan was confirmed Feb. 8 and went in effect March 1. As part of the Plan, the company received a $25 million capital infusion through a rights offering to its Class A noteholders that was backstopped by Istithmar World and Whippoorwill Associates. The restructuring eliminates all $110 million of the company's long-term bond debt, $14 million in related annual interest, $23 million in other cost reductions, and recapitalizes the balance sheet through the exchange of notes for common stock.