Wacky designer goes bust

Veteran US fashion designer, Betsey Johnson, has filed for bankruptcy and will close the majority of her 63 stores following years of financial insecurity.

The iconic wacky Johnson will remain fronting the label, however, Steve Madden Ltd, which is the brand’s licensee, is likely to keep only a handful of flagships open in destinations like New York City.

Johnson turned over her label, which is known for its bright and electric clothing, to Steve Madden in 2010, in return for it assuming her US$48.8 million in outstanding debts.

It’s unclear if Castanea Partners, a Boston-based private equity firm that took over the company in 2007, will retain control of the company following the filing for Chapter 11 bankruptcy in New York this week.

The retailer had outlined plans to have 100 stores in 22 US states by 2012, however, had only reached 63 sites as of early 2012, with two of those in the UK and six in Canada.

Johnson was is known her short marriage to Velvet Underground’s John Cale, spinning cartwheels after her runway parades, and giving birth to her only daughter immediately after showing a children’s wear collection show in 1975.

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