Max Azria objects to BCBG's proposed restructuring plan
Max and Lubov Azria have launched an objection to BCBG Max Azria's proposed restructuring plan.
The brand, favoured by stars including Drew Barrymore and Selena Gomez, has undergone major upheaval of late with bosses filing for bankruptcy in March (17) and unveiling serious cost-cutting measures.
Max, who founded the label in 1989, and his wife Lubov, who was formerly BCBG's creative director, have owned 20 per cent of the company since 2015, and are now reportedly opposing aspects of the restructuring plan.
According to WWD, the couple have filed documents voicing their disapproval of the proposal, "arguing that it calls for overly broad and compulsory releases of financial claims," including information which pertains to them personally.
The Azrias also allege that they still have "substantial claims" against the company, with the claims relating to lease payments on property they own, Lubov's severance, and Max's contribution to an aircraft. The objection states that the claims amount to more than $360,000 (£277,000).
Max and Lubov brought partners into their business for the first time in 2015, agreeing on a $135 million (£104 million) deal with Guggenheim Partners and its affiliates that changed the equity structure.
In April, a bankruptcy court judge ruled that Lubov's employment, including her severance pay, could be refused by BCBG executives as part of the restructuring processes. However, it appears that she is still wanting to receive payment.
Under the planned Chapter 11 bankruptcy proposal, BCBG will cease operations and its intellectual property (IP) will be sold to Global Brands Group. Yet, the label is expected to continue in some form, with a licensing deal being lined up.
BCBG has been closing many stores in recent months, and had previously informed around 200 U.S. stores of its plans. Prior to this the label had shuttered 120 stores and forged plans to close up in Canada in addition to merging its businesses in Japan and Europe.