The owner of 10-store jewelry and accessory chain Afaze, as well as clothing retailers Mandee and Annie Sez, filed for Chapter 11 bankruptcy protection on Jan. 6, citing damage caused by Superstorm Sandy.
Salus Capital Partners has agreed to provide $13.2 million in debtor in possession financing for the company.
Totowa, New Jersey-based Big M took over the 23-year-old Afaze chain in January 2012. Mandee has 84 locations, and Annie Sez, 35.
In its bankruptcy filing, the company said that for most of its history, “it operated profitably,” until it began to be hurt by decreased consumer demand caused by the recession. In November 2011, the company hired a restructuring officer.
But the biggest blow, Big M says, was Superstorm Sandy, which closed all the company’s tri-state area stores. Some still operate on a limited basis to this day.
Following the storm, Big M’s “business declined and has not since recovered,” the papers said. “Much of the debtor’s resources post-Superstorm were spent on returning the stores to an operational level.”
The company also cites an inability to reach a settlement with its insurance company, which it accused of “dragging its feet” and offering a “fraction of its claim amount.”
Big M currently employs approximately 1,200 people, including 490 full-time employees, 710 part-timers, and an additional 600 employees hired periodically during the busiest times of the year.