Owning a retail chain to showcase its portfolio of denim brands will have to wait for Blue Holdings Inc.
The Commerce, Calif., company, which owns the Antik Denim, Taverniti So and Yanuk brands, said Tuesday that its proposed acquisition of the Up Against the Wall retail chain from Long Rap Inc. had fallen through.
According to a statement released by Blue Holdings, both companies felt the deal would not have been in the best interests of their respective shareholders.
“While we are disappointed that we were unable to conclude our acquisition of the Up Against the Wall retail stores, we are now able to refocus our efforts on our wholesale business, while continuing to develop our retail strategy,” Paul Guez, president and chief executive officer of Blue Holdings, said in a statement.
Patrick Chow, chief financial officer of Blue Holdings, said the timing of the deal wasn’t right for either party and stressed that there was no single factor preventing the acquisition.
“We both have our different strategies,” said Chow. “There are certain things that we felt were good fits between the two, which is what we started out with. But we also found that there were some things that weren’t working for either side, so that’s why we found the timing was not right at this time.”
Blue Holdings unveiled the planned acquisition of the 24-store Up Against the Wall chain in June. The proposed deal called for Blue Holdings to pay Long Rap shareholders $16 million in cash and another $16 million in common stock.
Guez viewed the acquisition as a significant step toward his goal of opening between 100 and 200 retail stores showcasing an expanding portfolio of Blue Holdings’ brands. The deal would have helped Blue Holdings avoid developing a retail concept from scratch and would have given the company a significant retail presence on the East Coast, primarily in the Washington metropolitan area, and in Miami and Las Vegas.
Chow said management was still looking to develop a retail strategy and would not rule out attempting to acquire another retail chain if the opportunity arose.
“We are very disappointed that we weren’t able to pull this through, so at present, the strategy is still under review,” said Chow.