A’Gaci looks to leave bankruptcy
San Antonio-based A’Gaci, the women’s fashion and accessories retailer, is moving toward emerging from bankruptcy.
A’Gaci this week received bankruptcy court approval to enter into a commitment letter for up to $12 million in financing from a Boston lender.
“It’s critical for the debtor to obtain exit financing in order to emerge from Chapter 11,” Ian Peck, an A’Gaci bankruptcy lawyer, said at a Tuesday court hearing before Chief U.S. Bankruptcy Judge Ronald King approved the request.
Peck declined to comment after the hearing, directing questions to A’Gaci co-founder David Won.
A’Gaci filed for bankruptcy protection in January, blaming its problems on a failed expansion, hurricanes last year affecting its most profitable stores, and the delayed implementation of an inventory management system. It had $82.9 million in assets and $62.1 million in liabilities the day it filed for bankruptcy, a court filing indicates.
A’Gaci sought to reorganize after it canceled an auction of its assets in March when it received no qualified bids.
The reorganization plan calls for A’Gaci to exit bankruptcy as a leaner organization, with fewer stores and a smaller distribution facility. The company closed more than 20 stores it says were unprofitable and expects to operate 55 stores going forward.
San Antonio-based A’Gaci’s bankruptcy filing came in January.