Deb Shops Files For Bankruptcy

Fashion retailer Deb Shops, Inc. filed for Chapter 11 bankruptcy on June 26, 2011. Ableco Finance LLC issued a stalking horse bid to acquire substantially all of the Deb Shops' assets through a Court-supervised auction under Section 363 of the US Bankruptcy Code, with a close date in September 2011. Current owner Lee Equity Partners LLC will receive an undisclosed ownership stake in Deb Shops following the sale on account of its interest in the company's senior credit facility. Ableco committed up to $21.7 million in financing to support Deb Shops' business and liquidity needs, and current CEO Mark Hoffman will remain as CEO.