Entourage Baby Stroller Manufacturer Austlen Baby Co. Files for Bankruptcy Protection

The Austin, Texas-based company behind the $850+ Austlen Entourage baby stroller voluntarily filed for Chapter 11 bankruptcy protection on Sunday, June 10, 2018 in the United States Bankruptcy Court for the Western District of Texas.  Limited information about the reasons for the bankruptcy filing or what this means for the company and its customers is available at the time of this article (UPDATE: we've got more details now - check out our more recent article here). 

However, court filings do provide some insight into the company and its success in finding a market for its high-end strollers.  According to information from the company's website, its Entourage stroller was debuted "to rave reviews at the 2015 ABC Kids Expo, the leading juvenile products industry trade show."  Court filings show that the company has generated gross revenues of approximately $1 million in each of its two last full years of operations.


In addition, documents filed with the Texas bankruptcy court reflect that the company has approximately $13 million in assets, while it owes creditors slightly less than $4.5 million in debts, almost $3 million of which are secured debt. 

However, the $13 million in assets is comprised mostly of intangibles.  Specifically, the company values its patents at $9.7 million (compared to a net book value of approximately $452,000), its domain name at $2.4 million (approx. $455,000 net book value), and its customer list at approximately $227,000 (same net book value).  In total, intangibles and intellectual property comprise over $12.3 million of the reported $13.25 million in asset value.

Liquid assets and inventory are much different stories.  The company reported cash on hand of only $670.  Moreover, its bank accounts (checking, savings, money market, etc.) have balances of only slightly more than $10,000, for total cash and equivalents of less than $11,000.  Nor does the company have a large amount of accounts receivable outstanding.  It reports accounts receivable (90 days old or less) of less than $75,000, of which $5,657 is doubtful or uncollectable accounts.  Finally, as of April 30th, Austlen had inventory (all of which was finished goods) of approximately $85,500 (valued at cost).  

The bankruptcy case is In re: Austlen Baby Co. (f/k/a City Bebe Ltd.) and has been assigned case number 18-10749-hcm in the United States Bankruptcy Court for the Western District of Texas (Austin Division).  The case is currently assigned to United States Bankruptcy Judge H. Christopher Mott.  Austlen Baby Co. is represented by attorney Kell C. Mercer of the law firm Kell C. Mercer, PC, also located in Austin, Texas.  


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