BCBG Max Azria to undergo major cuts this fall
Oct 5, 2016
Designer brand company BCBG Max Azria Group will be experiencing massive layoffs this year. According to filings from the California Employment Development Department, the cuts will take effective starting next month on November 1.
According to the documents, there will be 123 permanent layoffs for the Vernon-based company. As reported by WWD, a company spokesman has confirmed this information, without alluding to any reason for the cuts. FashionUnited has currently reached out to BCBG Max Azria for a comment on these cuts.
This announcement of mass layoffs comes after BCBG Max Azria hired on Marty Staff as interim chief executive officer. He started his role earlier this year while Max Azria, eponymous founder of the company, was on paid leave for the summer. For the time being, there is no search for a more permanent chief executive officer, so it seems that Staff will be in the head role for some time.
BCBG Max Azria to cut 123 employees
His duties included turning the company around and growing the brand internationally and through its e-commerce website. It’s possible that these cuts are strategic moves for the benefit of BCBG’s business. The company has struggled for a while, starting with a debt that began in 2013. The debt equaled to approximately 685 million dollars, reported by Apparel News. More than half of the debt, approximately 475 million dollars, was the responsibility of investment and advisory financial services firm Guggenheim Partners. Since then, the company has improved and moved towards getting out of debt.
Early last year, the company had announced that it was restructuring financially. This restructure plan included a 135 million dollar capital infusion from the company’s now majority shareholder, Guggenheim Partners. Although he is no longer the majority shareholders, Azria still holds a “significant stake” in the company according to WWD.
It may seem somewhat of a shock that BCBG Max Azria may be in financial toil, especially given the brand’s internationally renown name and brand. However, with this many employee layoffs, it seems safe to assume that the company may be internally struggling. What’s next to come for BCBG’s immediate future remains a mystery.
Photos: BCBG Max Azria