Urban Brands makes it its business to prove that women of style come in different shades and sizes. The company owns the Ashley Stewart brand, whose collection of career apparel, sportswear, denim, lingerie, and accessories (including hats, scarves, and jewelry) is geared toward plus-sized (sizes 12 to 26) African-American women. Urban Brands operates about 175 stores under the Ashley Stewart banner in some 25 states, the District of Columbia, and the US Virgin Islands. After a short stint in Chapter 11, the company was acquired out of bankruptcy by investment group GB Merchant Partners (an affiliate of liquidator Gordon Brothers Group) for nearly $16 million in late 2010.
GB Merchant Partners is working to turn around Urban Brands' sagging business. The investment unit, which will assume some of the retailer's liabilities, said it is reviving the chain from a "new and stronger position." It has left most of Urban Brands' retail network intact -- shuttering about 35 locations of 210 total stores -- and is expected to focus on profitability going forward.
An emphasis on the bottom line would be a welcome change at Urban Brands, which filed for bankruptcy protection in September 2010 after several years of losses. The company began to suffer from liquidity problems in 2008, and its woes continued through the downturn in the economy. In 2009 it posted a loss of more than $28 million. When it filed for Chapter 11, Urban Brands estimated its liabilities at between $100 million and $500 million and assets between $10 million and $50 million. GB Merchant Partners was the stalking-horse bidder for the retailer, and in October the investment group emerged as the winner of a bankruptcy auction that persisted for 21 hours. The Gordon Brothers affiliate won out over firms like Rainbow USA and Monomoy Capital. Urban Brands was previously majority-owned by investment firm Trimaran Capital Partners. Laura Weil, who took the CEO's post in mid-2009, remained with Urban Brands after the buyout. Weil spent a year leading the company on an interim basis before she was named chief executive, and she previously served as COO for ANN (formerly AnnTaylor Stores) and American Eagle Outfitters
As mass retailers such as Target and Wal-Mart offer casual clothing in plus sizes, Urban Brands sees an opportunity in marketing full-figure designer clothing. It had hoped to attract more well-dressed customers by expanding its selection to include smaller sizes and reach a younger demographic. The typical Ashley Stewart shopper is 25 to 45 years old, earns $25,000 to $75,000, and owns her own home. – less
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