Yesterday, high-end denim retailer True Religion announced that it would be filing for Chapter 11 Bankruptcy protection, proving that they have become only the latest company in recent months to have filed for bankruptcy. On the opposite side of the business spectrum, there were yet another couple of billion dollars thrown around in a corporate sale. This time it involved two credit card processing firms, Vantiv and Worldpay.
Why True Religion had to file for bankruptcy
True Religion has announced that it has filed for bankruptcy protection, specifically for creditor protection under in a bankruptcy court in the District of Delaware.
In the filing, True Religion listed assets and liabilities in the range between $100 to $500 million dollars. The company has also signed a restructuring agreement with many of its lenders, including TowerBrook Capital Partners, which will help to cut True Religion's debt by more than $350 million dollars.
The company CEO, John Ermatinger, said the company is taking a critical step to reduce debt and that all trade creditors vital to the business are expected to be fully paid. In recent years True Religion's has declined since its denim has fallen out of style and because of the shift to online shopping. The company mostly sells their products in department stores or brick-and-mortar shops. Their bankruptcy plan, which was drawn up prior to the filing, will now take three to four months to get confirmed by the court.
Vantiv buys rival Worldpay for billions
In the exciting world of credit card processing, American-based firm Vantiv has agreed to purchase their United Kingdom-based rival Worldpay for around $9.9 billion dollars. This move now combines both companies similar businesses in order to capitalize on expanding international and e-commerce opportunities.
Both of these companies are two of the biggest processors of credit card payments at retail and online stores in the world.
To some, the merger between Vantiv and Worldpay indicates a possible consolidation in the credit card processing business could limit options for business owners. Vantiv has a line of software and hardware products used at checkouts when shopping.
These range from card readers to fraud detection application to mobile wallet verification. Worldpay on the other hand, processes around 31 million retail, online and mobile store payments every day.
