Perry Ellis completes acquisition of Tropical Sportswear for $88.5 million

By Ellen Chang

Houston, Feb. 28 - Perry Ellis International, Inc. announced Monday that it has completed the acquisition of the domestic operating assets of Tropical Sportswear International Corp. and the capital stock of Tropical Sportswear's U.K. subsidiary for $88.5 million in cash.

Tropical Sportswear, a Tampa, Fla. apparel designer and marketer, filed for bankruptcy on Dec. 16.

The company entered into a so-called "stalking horse" asset purchase agreement with Perry Ellis. Following an auction, the sale was approved by the U.S. Bankruptcy Court for the Middle District of Florida on Feb. 10.

Tropical Sportswear's $50 million debtor-in-possession was terminated, according to an 8-K filing with the Securities and Exchange Commission on Monday. The CIT Group and Fleet Capital had provided the DIP.

The company repaid $15.92 million under the DIP credit facility and the company provided $745,500 as cash collateral for outstanding standby letters of credit.

The company said it anticipates filing a Chapter 11 plan of liquidation to sell its remaining assets and distribute proceeds to creditors.

Tropical Sportswear's Chapter 11 case number is 04-24134.

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