Creative Hairdressers, Inc., parent company of Hair Cuttery, Bubbles and Salon Cielo, has announced an agreement to sell its assets to HC Salon Holdings, Inc., an affiliate of Tacit Salon Holdings, LLC, along with a plan designed to significantly reduce its debt obligations and establish a financial platform for long-term growth. The company plans to re-open its salons when local and state authorities determine it is safe for employees and customers to return in wake of the COVID-19 crisis.
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HC Salon Holdings, Inc. will acquire substantially all Creative Hairdressers’ assets, including the majority of its salon locations. In addition, as the senior secured lender, HC Salon Holdings has agreed to provide the company with debtor-in-possession financing that will allow the it to continue operations, effectuate the sale process and fund operating expenses, including its payroll and other obligations to employees.
To implement the plan, Creative Hairdressers and its affiliate Ratner Companies, L.C., filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the District of Maryland. The company does not expect the filing will have a meaningful impact on its day-to-day business once its salons are able to re-open and expects to complete the sale process within 45 days.
Creative Hairdressers, Inc. is represented by Shapiro Sher Guinot & Sandler. Carl Marks Advisors is acting as strategic financial adviser to assist the company in the process. HC Salon Holdings, Inc. is represented by DLA Piper LLP (U.S.).
“We are extremely pleased to have reached a positive outcome that enables us to pay our talented salon professionals, field leaders and resource center associates, and then reopen our doors and save thousands of jobs for our outstanding salon staff,” Phil Horvath, president of Creative Hairdressers, Inc., said. “These have been unprecedented and trying times for everyone, and especially for our industry. Our new financial partners are excited about the long-term potential in our industry and our ability to rebound post-crisis. We look forward to re-opening our doors and building a stronger future for our business.”
“We’re happy to support Creative Hairdressers and its thousands of salon professionals as the company emerges from the COVID-19 crisis in a stronger financial position,” Azhar Quader, chairman of Tacit Salon Holdings, LLC, said. “Hair salons are an important contributor to the fabric of life in communities across the country. We’re focused on saving jobs for salon professionals and building a strong, financially healthy company. We look forward to having Creative Hairdressers' talented stylists provide excellent service to their customers for many years to come.”