Final Cut: Wet Seal to Proceed with B. Riley, Despite Versa’s Attractive Terms
ABF Journal illustrator Jerry Gonzalez provides his take on Wet Seal’s initial approval from a bankruptcy judge January 20, 2015, to proceed with DIP financing from B. Riley, despite a last-minute offer from Versa Capital Management offering attractive financing terms.
Dow Jones & Company reported Wet Seal received initial approval from a bankruptcy judge January 20, 2015, to proceed with DIP financing from B. Riley, despite a last-minute offer from Versa Capital Management offering attractive financing terms.
Dow Jones also wrote that Judge Christopher Sontchi of the U.S. Bankruptcy Court in Wilmington, DE, said he was satisfied Wet Seal’s choice to continue with B. Riley was a sound business decision even though Versa had offered financing on better terms.
According to court documents filed January 19, 2015, Gregory L. Segall, chairman and CEO of Versa Capital Management, submitted a letter to The Wet Seal’s board of directors c/o the company’s president and CEO, Edmond Thomas, dated January 19, 2015, with a proposal about a plan sponsorship agreement and DIP term loan.
Regarding the company’s decision to choose B. Riley, Dow Jones added that The Wet Seal’s lawyer, Michael Tuchin of Klee, Tuchin, Bogdanoff & Stern, said the company preferred to continue working with B. Riley, which had engaged in a long due diligence process and is familiar with the company’s “warts,” while Versa only had access to public information and hadn’t engaged in the same due diligence.