A shocking news came over CelebrityClothingLine.com’s desk today and it says that Kimora Lee Simmons’ Baby Phat clothing line might have to go under. The Wall Street Journal reports that Baby Phat and Phat Farm’s holding company, Kellwood Co., could be forced to file for bankruptcy:
Kellwood Co., one of the largest apparel manufacturers in the U.S., could be forced to file for bankruptcy soon, after it failed to reach an agreement with its bondholders.
The St. Louis-based company, which employs roughly 2,000 people and owns such popular clothing brands as Phat Farm, Sag Harbor and Vince, was taken private in February 2008 by buyout firm Sun Capital Partners for $542 million.
The twin effects of a heavy debt load and a sharp drop in consumer spending have crushed the company’s financial results.
Kellwood has a $140 million bond issue …
The economy is shattering every business it can get. It’s a good thing Russell Simmons sold Phat Farm and Baby Phat to Kellwood five years ago for $142 million in cash plus performance incentives. However, Kimora Lee stays HBIC at Baby Phat and everyone is wondering how this bankruptcy thing is going to affect her and her clothing line.
We’ll be staying in tune for more.
See Kimora’s Baby Phat Collection