Entertainer and business mogul Sean Combs has bought back the Sean John streetwear label he founded in 1998 for $7.55 million in cash, plus certain assumed liabilities.
Combs, who is known by his Diddy moniker, acquired the brand via a bankruptcy court auction on Monday in Manhattan. He initially submitted a bid of $3.3 million through SLC Fashion LLC and was selected as the stalking horse bidder.
The Sean John label was owned by GBG USA, but GBG filed its own Chapter 11 petition for bankruptcy court protection back in July. GBG Sean John LLC was not a party to that initial filing due to a joint venture technicality. GBG Sean John filed its Chapter 11 petition on Dec. 2.
Combs launched his Sean John brand in 1998 and sold a majority stake to brand management agency CAA-GBG in 2016. Combs retained a minority stake in the brand in the range of 10 percent. In recent months, the relationship between Combs and GBG soured, with the rapper filing two lawsuits this year against GBG over publicity rights and a trademarked slogan.
Court documents indicated that four additional parties submitted bids before the deadline in anticipation of the court auction. The four who submitted bids were Allura Imports, Crestview Investments, One Step Up and United Ventures. A court declaration from Agnes K. Tang, a partner at the investment banking firm Ducera Partners representing GBG Sean John, said that after 14 rounds of bidding, Combs and SLC Fashion was deemed the successful winner. The final bid from United Ventures at $7.5 million was named the back-up bid.
A court hearing to approve the sale is slated for Wednesday.
GBG USA has sold off most of its brands, including Aquatalia, Tahari and now Sean John. Following GBG USA’s Chapter 11 petition was a similar filing by its parent company Global Brands Group Holding Ltd. in September. After initially thinking it would restructure, Global Brands Group Holding is now in the process of winding down its operations.