<div><p>Delta Apparel Inc., parent company of the Salt Life activewear brand, was sold in a bankruptcy auction for $38.74 million on September 16 to brand management firm Iconix International and business management consultancy Hilco. The sale, approved by the court, includes the Salt Life brand and its assets.</p><p>Most Read from Fast Company</p><p>Iconix plans to shift Salt Life’s focus toward e-commerce and wholesale, marking a significant change in the brand’s business model. As part of the restructuring, Salt Life’s 28 retail stores, spread across Alabama, California, Delaware, Florida, Georgia, New Jersey, New York, South Carolina, Texas, and Virginia, began liquidation sales on Friday, according to a statement by Hilco.</p><p>The Chapter 11 filing, submitted in Delaware court on June 30, showed Delta Apparel had $337.8 million in assets and $244.5 million in debts. The company’s top five creditors were owed a combined $29 million.</p><h2>Grassroots beginnings</h2><p>Founded by “four watermen” from Jacksonville Beach, Florida, Salt Life began as a grassroots apparel brand before expanding into performance wear, swimwear, accessories, and even branching out into restaurants and beer. (Salt Life Food Shack buinesses were not owned by Delta and are not effected by the bankruptcy court proceedings.)</p><p>In 2013, Delta Apparel acquired the brand for $15 million, when it had an annual revenue of $20 million. (By October 2023, Delta disclosed receiving an unsolicited offer for the brand, though the terms were not revealed.) Under Delta's ownership, Salt Life grew into a profitable business, generating over $60 million in revenue through a combination of over 1,700 wholesale outlets across 48 states, as well as direct-to-consumer sales via its website and branded retail stores.</p><p>However, Delta Apparel faced significant financial challenges in the last two years. Chief Restructuring Officer J. Tim Pruban pointed to reduced demand and liquidity issues, which were worsened by a surge in cotton prices in 2022 that increased production costs.</p><p>Despite attempts to cut expenses by reducing severance obligations and downsizing offshore manufacturing operations, the company continued to struggle with declining sales. Delta reported $78.9 million in sales for the second quarter of fiscal year 2024, down from $110.3 million the previous year. As liquidity worsened, Delta defaulted on its loan terms, leaving it with over $80 million in outstanding credit and just $2 million in cash when it filed for Chapter 11 bankruptcy protection.</p></div>

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Salt Life clothing brand is closing 28 retail stores and holding liquidation sales: Full list and map of doomed locations

Delta Apparel Inc., parent company of the Salt Life activewear brand, was sold in a bankruptcy auction for $38.74 million on September 16 to brand management firm Iconix International and business management consultancy Hilco. The sale, approved by the court, includes the Salt Life brand and its assets. Most Read...