Suppliers seeking to pull Canadian slip sequence La Senza into failure for delinquent bills

Companies that supply panoply for tradesman La Senza are perplexing to pull a association into failure since they contend a slip sequence isn’t profitable a bills.

According to justice documents, U.S. attire manufacturer MGF Sourcing is seeking an contingent petition opposite a owners of La Senza underneath Chapter 7 of a U.S. failure code.

Founded in Quebec in 1990, La Senza grew to turn one of a biggest sellers of women’s underwear in Canada before being bought adult by a owners of U.S. slip hulk Victoria’s Secret in 2007.

In early 2019, La Senza’s owners afterwards sole a association to a California-based private equity organisation called Regent LP. As partial of that deal, La Senza was ostensible to secure a minute of credit from a prior owners that would pledge remuneration for suppliers like MGF if they continued to send products to La Senza. According to justice documents, that never happened, and MGF says La Senza now owes them roughly $42 million for products that have already been sent off to La Senza to sell. 

“Despite MGF’s efforts to work in good faith with La Senza to find solutions, La Senza frequently overlooked a obligations and eventually refused to yield MGF with adequate assurances of destiny performance,” MGF says in a justice filing, adding that a tradesman has turn “increasingly infrequent” in a communications with a supplier.

“MGF also demanded that La Senza stop offered products sourced by MGF and lapse them, though La Senza has not finished so.”

According to justice documents, dual other La Senza creditors — Sri Lanka-based Ocean Lanka Ltd. and Teejay Lanka PLC — are also subsidy a petition, nonetheless they contend they are due distant less: $731,805.50 for a former, and $195,209 for a latter.

According to a website, La Senza has 340 stores around a world, roughly one third of that are in Canada.

When companies are perplexing to restructure though devise to continue to work in some form, they typically willingly record underneath Chapter 11 of a U.S. banktruptcy code. But MGF has petitioned a justice underneath Chapter 7 of a code, a territory of a law typically used by creditors perplexing to pull companies into sum murder to compensate off their bills.

Requests for criticism from MGF, La Senza and a sell chain’s owner, Regent LP, were not immediately returned on Thursday.

Article source: https://www.cbc.ca/news/business/la-senza-bankruptcy-1.5445693?cmp=rss