Multichannel jewelry and home furnishings merchant Fortunoff has filed for bankruptcy and agreed to be acquired by NRDC Equity Partners LLC, the owner of Lord & Taylor.
“It has been a difficult retail environment and capital constraints have limited our expansion opportunities,” said Arnold Orlick, CEO of Fortunoff, in a statement.
NRDC said it plans to invest $100 million into the Fortunoff business, making investments in both existing and additional stores. In addition, Lord & Taylor has made a $10 million letter of credit available to enable Fortunoff to continue to purchase inventory. Some of Fortunoff’s existing lenders have agreed to provide the company with debtor in possession financing that will be used to run its business during the bankruptcy process pending the sale.
The sale will be accomplished through a bankruptcy process that permits other interested parties to make competing offers. The sale is expected to close in early March.
All of Fortunoff’s stores will remain open during the Chapter 11 process.