Rockport Company Files for Chapter 11 Bankruptcy, CEO Resigns
The Rockport Co. said on Thursday that it has filed Chapter 11 bankruptcy in a U.S. District Court in Delaware and will put itself up for sale.
According to the footwear brand, its subsidiaries CB Marathon Midco, LLC, Rockport IP Holdings, LLC, Rockport UK Holdings Ltd. and CB Footwear Services, LLC have also joined in the bankruptcy filing.
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Rockport said that it’s taking this motion in order to “review and restructure” its assets for the benefit of all stakeholders and to better position the brand for future growth opportunities.
As part of the bankruptcy, Rockport said it also intends to file a motion seeking authorization to pursue an auction and sale process. The proposed bidding procedures, if approved by the court, would require interested parties to submit binding offers to acquire Rockport’s assets.
With this news, Rockport announced that its CEO, Gregg Ribatt, has resigned from the company and will be available to assist in an orderly transition.
What’s more, Joseph Marchese of PKF Clear Thinking has been appointed chief restructuring officer of Rockport.
“The immediate relief of Chapter 11 is appropriate to provide the company the opportunity to assess the situation and develop a process to maximize value recoveries for all stakeholders,” Marchese said in a statement. “Rockport has valuable assets that can be effectively administered in an organized joint process. I want to assure every employee, customer, creditor, contract party, investor and other stakeholders that we are going to conduct this effort with diligence, thoroughness and transparency.”
It’s unclear if other leaders or how many employees are leaving as well, but Rockport said in its release that “any employees” are expected to continue with the company and assist Marchese and independent advisors and professionals in Rockport’s operations during the Chapter 11 proceedings.
The company added that it currently anticipates operating “business as usual” during the Chapter 11 process and customers should see no disruption in service or product quality.
Subject to court approval, Rockport said it will operate utilizing debtor-in-possession financing, which will provide the company with sufficient liquidity to continue its operations during the Chapter 11 case and related sale process.
In anticipation of the Chapter 11 sales process, Rockport has entered into negotiations with a potential purchaser, who has significant experience in the industry, to serve as a stalking horse bidder. It’s unknown at this time who the potential purchaser may be.
This action comes after the shoe company notified state officials in Massachusetts that it may shut down its headquarters in West Newton as soon as July.
In a notice filed on May 9 with the state Executive Office of Labor and Workforce Development, Rockport said that it anticipates employee separations may occur between July 8 and July 22. Rockport said 148 employees may be affected.
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