Tamara Mellon to quit New York HQ amid bankruptcy

Former Jimmy Choo partner Tamara Mellon is to close her self-named fashion company's Madison Avenue headquarters as part of a plan to emerge from bankruptcy in America.

Mellon founded her company after she left Jimmy Choo having found significant financial backing to set up a new venture. However two years after setting up shop in Manhattan, above the famous Barneys luxury fashion store, the company failed to meet its sales expectations and subsequently filed for Chapter 11 bankruptcy in Delaware on December 2, providing protection from its creditors while it prepares a new financial plan.

The original backers are likely to lose their whole investment. The company plans to come out of Chapter 11 with new funds from NEA, a private equity firm, and Mellon herself. Last week it told the Delaware court handling the bankruptcy that it would “reject” the lease on the Madison Avenue offices.

Chapter 11 gives businesses the power to get out of contracts with the court’s approval. The company said the offices were too big and the landlord had the right to change them to residential use in a few years, making it hard for Tamara Mellon to find a replacement tenant. The deadline for objections to the plan to come out of Chapter 11 is next week.

Image:Tamara Mellon