LONDON (Brand Republic) 鈥 American sportswear brand Converse, maker of the famous canvas All Star basketball boots, has filed for Chapter 11 bankruptcy protection after 97 years in business.
The move follows the brand鈥檚 attempt to compete with powerhouses Nike and Adidas. At one stage, it launched a trainer filled with lighter-than-air helium to compete with Nike Air.
Several of Converse鈥檚 manufacturing plants in North America and Mexico will be closed, resulting in around 1,000 redundancies. Converse will shift production, following the likes of Nike and others, to the 鈥渆nterprise zones鈥 of Asia.
The company鈥檚 factory in North Reading, Massachusetts, has already been sold for $15.1m.
Converse-branded footwear will continue to be sold through a licensing agreement with Global Brand Marketing Inc for the US.
Converse chief executive Glenn Rupp said: 鈥淲hen the royalty income from this deal is added to that of its existing licensing agreement, Converse will be generating a substantial stream of royalty income. Our goal is to emerge from this process as a leaner and financially healthier business.鈥
Converse filed for bankruptcy once before in 1929, only to make a buoyant recovery by supplying the US Army with footwear and other equipment.