Former Billabong US operator Liberated Brands files for bankruptcy

Liberated Brands, the former operator of Quiksilver, Volcom and Billabong, has filed for Chapter 11 bankruptcy protection in a Delaware court, to which it revealed plans to wind down North American operations.

Having previously operated brands under a licensing deal with Authentic Brands Group, Liberated has confirmed that it has been transitioning these licenses to new “well-capitalised partners who are actively investing in their growth” and thus the brands’ futures will not be impacted.

Authentic had terminated its North American licensing deals with Liberated for the wholesale of Volcom, RVCA and Billabong in December after the firm was unable to pay royalties, court documents revealed.

In a statement, Liberated said that its team “has worked tirelessly over the last year to propel these iconic brands forward, but a volatile global economy, consumer spending changes amid a rising cost of living, and inflationary pressures have all taken a heavy toll”.

Its CEO, Todd Hymel, meanwhile, blamed a wider shift in consumer preference towards “fast fashion”, meaning companies with the ability to cater to quickened demand were prevailing in the current market.

Liberated’s 100 US stores to close

A liquidation process overseen by Gordon Brothers Group has begun among Liberated’s 100-plus store network in the US, all of which will close upon completion of the process. Its nine stores in Hawaii are currently under negotiations.

Liberated noted that with the filing of customary motions, it “intends to uphold its commitments to customers, employees, and partners”.

In its statement, it added: “Despite this difficult change, we are encouraged that many of our talented associates have found new opportunities with other license holders that will carry these great brands into the future.”

While JP Morgan has been appointed to finance the Chapter 11 process, retaining Morgan, Lewis & Bockius LLP and Berkeley Research Group, LLC, Liberated itself has retained Kirkland & Ellis, LLP and AlixPartners LLP to assist.