Regarding NEXC
From Yahoo finance...
Portfolio.com
Fashion's Bright Idea Dims
Tuesday May 20, 8:00 am ET
In theory, NexCen Brands is a brilliant business model: a portfolio of fashion and retail brands that can be leveraged by a savvy finance company.
And it is headed by an innovative executive: Robert D'Loren, who helped Bill Blass and Oscar de la Renta raise money by bundling their trademarks and licensing revenue to back bonds. D'Loren was once described as the Michael Milken of fashion securitization.
Yet his brilliant plan, as the British would say, has now gone all pear shaped.
NexCen, which owns Bill Blass, Athlete's Foot, Waverly, and other brands, has warned that it may not survive.
The problem is that the company faces a $30 million debt payment by October 17, stemming from its January acquisition of the Great American Cookie Co. Given the current credit market, that will be difficult. "These features of the January 2008 amendments…have raised significant concerns about the company's liquidity and capital resources," NexCen said in a filing with the Securities and Exchange Commission.
Shares of NexCen plunged 85 percent on Monday.
The company says it is exploring the possible sale of one or more of its businesses, among other options, and is holding discussions with its lender.
Vicki Young of Women's Wear Daily says that the Blass and the Waverly brands were the most likely to be sold quickly to raise cash, adding that Tharanco and NRDC Equity Partners are being seen as possible buyers of Blass.
Michael Barbaro of the New York Times notes that "the troubles at NexCen have riveted New York's fashion community, because of the uncertainty regarding Bill Blass. NexCen had promised to revive the clothing brand, which has struggled since Mr. Blass' death in 2002."
NexCen was created in 2006 by the merger of a former wireless company whose business evaporated when the bubble in telecommunications burst and UCC Capital, D'Loren's investment bank.
From the beginning, the company has had its believers.
Indeed, until Monday, all four of the analysts that covered the company had "buy" ratings on the stock.
