Emerisque Brands and its Indian partner S Kumars Nationwide Ltd, an apparel company, today got a US court's approval to acquire bankrupt suit maker Hartmarx Corporation in a deal valued at about 128 million dollars.
The sale, approved by Judge Bruce Black in Federal bankruptcy court here, is expected to close by July 7.
"We are pleased with the news. This is a terrific outcome for the workers -- all 3,000 of them," Hartmarx chairman and chief executive Homi Patel said. Black was quoted as saying to about 30 Hartmarx employees present in the court, "It sounds like you have jobs to go back to".
The purchase agreement includes both companies taking on $33.5 million of the suitmaker's debt.
Today's approval of Emerisque's bid to buy Hart Schaffner Marx and the cooperation by Wells Fargo is good news for nearly 4,000 workers, their families and our economy, Phil Hare, Democratic Congressman from Illinois, said.
Emerisque has said it intends to keep Hartmarx intact and preserve its US operations.
Earlier this month, British private equity firm Emerisque and SKNL North America were designated the stalking horse bidder for Hartmarx. This week five more companies had submitted their interest as bidders for the suit maker, whose clintele includes President Barack Obama.
Hartmarx had filed for bankruptcy in January this year as tough economic times crippled its sales and it was unable to raise finances.
Its main creditor Wells Fargo, which is owed $114 million, had been putting pressure to stop the sale and liquidate the city-based Hartmarx, a move that had sparked outcry among its 3,000 workers across the country.
American and Illinois workers can declare victory on Friday. This ruling comes at a time when our state is in desperate need of living wage jobs with one in 10 people out of work.
"It also sends a clear message that banks, especially those that received federal bailout funds, must do the right thing and invest in our nations economy and workforce," Illinois teasurer Alexi Giannoulias said.
The 120-year-old maker of Hickey Freman and Hart Schaffner Marx brands has made several suits for Obama, including the one he wore at his inauguration. Hartmarx has two factories in Illinois, one each in New York and Alabama.