Baccarat Crystals on the Verge of Debt Consolidation Lawrence Dunn, July 9, 2023 Since 1764, Baccarat artisans have honed their skills in the tiny hamlet of that name, crafting crystal works for royalty, movie stars, and the wealthy. Their work has survived Spanish flu, two world wars, and the French Revolution—and now a debt crisis that threatens to put the company on the verge of collapse. Founded in 1764, French crystal maker Baccarat is famous for its sparkling creations, from chandeliers to Champagne glasses. Its products have been used by everyone from Czar Nicolas II and the queen of Thailand to Coco Chanel and Franklin D. Roosevelt. But the brand has also racked up a dark legacy, including connections to Nazi collaborators. In 1943, the company produced a large crystal carafe for Hermann Goring—the highest-ranking Nazi official tried at the International Military Tribunal at Nuremberg—to celebrate his 50th birthday. The company is now owned by a consortium of funds led by private alternative credit funds, including Tor Investment Management, Sammasan Capital and CEOF Holdings. The group took control of the company’s owner, Fortune Legend Ltd., in a move to protect it from unsecured creditors after the Chinese borrower fell into arrears on loan payments. But the company’s future may be more complicated than just a dispute over debt. The consortium plans to file a mandatory takeover bid for all of Fortune Legend’s shares, which represent about 97% of Baccarat’s total stock, and delist the company, according to a filing with France’s markets regulator. Amid a global recession and the coronavirus pandemic, consumers have become more cautious about spending on luxury items. Many heritage brands are already struggling as a result. Sales at a handful of the world’s most exclusive stores have plunged, and many consumers are trading down to less expensive items—in some cases, even turning to discounters like Ross and Marshalls, where the prices are much lower. But Baccarat is trying to refocus its strategy, focusing on building an online presence and launching a hotel brand called the Baccarat Residences Miami in a city that’s booming with 20-something transplants and other upscale shoppers. The hotel will feature a lounge and a boutique, and the company says it has a few other properties in the works—including one in New York City. Its upcoming collaboration with designer Virgil Abloh, whose line of vases and glasses is expected to launch in early 2020, is another sign that the brand is trying to reach a younger audience. The firm’s new president, Jim Shreve, is a former executive at Diesel and Faconnable who has spent the last five years rejuvenating the brand by introducing buzzy collaborations and redesigning its internal business structures to appeal to younger customers. He almost turned down the job, but was encouraged by his partner Mark Brashear—a first-generation gay executive at Nordstrom and a top marketing exec at Calvin Klein—who is also the company’s chief brand officer. They’ve worked together to create a range of products and marketing campaigns that span the gap between classic and contemporary, luxury and necessity, and niche and mainstream. Main