Delta Apparel Files for Bankruptcy, Inks Deal to Sell Salt Life
Delta Apparel has filed for chapter 11 bankruptcy with a deal in hand to sell its Salt Life brand.
Delta Apparel, which has been grappling with significant market, operational and liquidity challenges, on Monday said it would continue to operate its businesses as it pursues a sale of its assets.
The Duluth, Ga., company said it plans to sell certain assets related to its Salt Life branded products for about $28 million to FCM Saltwater Holdings, which has agreed to act as the stalking horse, or lead, bidder in a court-supervised auction for the assets.
Shareholders are generally wiped out in bankruptcy cases, and Delta Apparel on Monday said holders of its common stock will experience a complete or significant loss on their investment.
Shares of Delta Apparel, which closed Friday at 58 cents, were down 33% to 39 cents in premarket trading before trading was halted.
The company said it expects its shares will be delisted from the NYSE American as a result of the bankruptcy filing.
Delta Apparel last month said it was suspending manufacturing operations in Honduras and exiting its DTG2GO business unit amid a deteriorating liquidity position.
Write to Colin Kellaher at [email protected]