(Bloomberg) -- Creditors of Toms Shoes LLC, the popular footwear seller that’s been struggling to weather declining sales amid a pile of looming debt, have agreed to take over the company in exchange for restructuring its debt.
The group of creditors, led by Jefferies Financial Group Inc., Nexus Capital Management LP and Brookfield Asset Management Inc. will assume the ownership from the shoemaker’s founder Blake Mycoskie and Bain Capital LP, Reuters reported, citing a company letter sent to its employees and people familiar with the matter.
In exchange, the creditors will offer debt relief to the company, the unidentified people said to Reuters. The new owners have already agreed to invest $35 million in the shoe company to help its growth, according to the letter.
It’s not clear whether Mycoskie will retain a role at the company, given he will no longer be an owner, the report said.
Bain bought a 50% stake in the maker of trendy shoes in 2014, hoping to build on the success of the firm founded by Mycoskie in 2006 with the goal of giving a pair of shoes to a child that needed them for every pair sold. But Toms has been battered by an industry-wide slump, aggressive competition, and a failure to diversify, and now struggles under a debt load that matures in 2020.
Read Bain Enlisted Boutique Bank Financo Amid Toms Shoes Sale Effort
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