After several challenging years for the beauty sector, another long-standing fragrance brand is feeling the impact. While the struggle continues, another company files for bankruptcy. IMG Holdings, Inc., the parent of Dana Classic Fragrances, has filed for Chapter 11 bankruptcy protection.
Highlights
- IMG Holdings, Inc., seeks Chapter 11 bankruptcy protection to restructure the business.
- Fragrance Xtreme emerges as the stalking-horse bidder for the key fragrance trademarks.
- Fragrance Xtreme is also offering debtor-in-possession financing to the company.
IMG Holdings, Inc., Files for Chapter 11 Bankruptcy Protection
According to PacerMonitor, IMG Holdings, Inc., the owner of Dana Classic Fragrances, has filed for bankruptcy. The company seeks Chapter 11 bankruptcy protection to reorganize itself under court supervision. It is doing so through the sale of the trademark of various key fragrances via a Section 363 sale.
Founded in 1932, Dana Classic Fragrances is known for a portfolio of enduring scent lines. Unfortunately, the ongoing stress in the beauty industry is reflected in the finances reported in the case filing.
IMG Holdings, Inc., reported more than $64 million in secured debt and $500,000 in unsecured trade debt. Meanwhile, the company made $4 million in sales in 2024 and $3.5 million in 2023. The figures underscore the company’s financial challenges and the need for restructuring.
Fragrance Xtreme to Provide DIP Financing
Fragrance Xtreme has offered $3 million for key fragrance trademarks, including legacy scents from the Dana portfolio. The sale will proceed under Section 363 of the U.S. Bankruptcy Code, allowing assets to be sold free and clear of existing claims. In this, Fragrance Xtreme, Inc., has emerged as the stalking-horse bidder for the trademarks, securing a baseline valuation for the sale.
Frangrance Xtreme is offering $3 million for the core fragrance trademarks. Apart from this, Fragrance Xtreme is also providing $500,000 in debtor-in-possession (DIP) financing. It will support IMG Holdings, Inc., in the initial stages of bankruptcy.
The move is intended to keep operations stable while management works on restructuring plans. Meanwhile, it will also get time to focus on restructuring the organization.
