Escada has responded swiftly to a report in Germany's Focus magazine that it was meeting with banks to negotiate bankruptcy options. The company said that a reported meeting of Escada's Supervisory Board in which insolvency was discussed "is pure speculation and not founded on any facts."

On Friday, Escada revealed that it was exploring the sale of its Primera division, which primarily targets the German market through the apriori, BiBA, cavita and Laurel brands. But the company denied the Focus claim that a "hasty sale" was in the works due to financial pressure. Escada insists the divestment was initiated by company strategy "reaching back as far as the year 2007."

UniCredit Bank has been given the assignment of selling Primera for Escada.

LBN Comment: Interestingly, Escada's statement didn't outright deny the Focus claim of a liquidity crunch, instead claiming the report was "highly speculative" and "in large parts incorrect." Escada did specifically say a reported €30 million liquidity need is "incorrect" without further comment, and corrected the published figure for the cost of the new Dusseldorf store (which was €150,000 rather than the €500,000 published by Focus).