Monday, July 13, 2009

baby bank aint so phat any more

Kimora Lee Simmon’s line Baby Phat might be headed bankrupt The Wall Street Journal reported that Kellwood Co. - an apparel manufacturer who’s brand’s include Baby Phat, Fabulosity, Phat Farm, Vince, and Xoxo, among others - may have to file for Chapter 11 bankruptcy if they can’t come up with the money to pay a $140 million bond issue by Wednesday. Kellwood has over $500 million in debt and $800 million in annual sales and according to the report “the twin effects of a heavy debt load and a sharp drop in consumer spending have crushed the company’s financial results.”

Russell Simmons launched Phat Farm clothing in 1992, while his, then wife, model/designer Kimora Lee Simmons, started Baby Phat in 1999. Russell sold Phat Farm and Baby Phat to Kellwood in 2004 for $142 million in cash plus performance incentives (at least he cashed out before the hard times hit!) though Kimora retained her position as “principal creative arbiter” for Baby Phat.

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