Obama suitmaker gets bailout loan

Hartmarx Corp., the bankrupt clothier that reportedly made the suit worn by President Barack Obama at his inauguration, won court approval to start using $160 million in financing from lenders including Wachovia Corp.

U.S. Bankruptcy Judge Bruce Black gave interim approval to a portion of the loan yesterday in Chicago, allowing Hartmarx to continue operating while it seeks to reorganize or find a buyer. Black will consider final approval of the loan at a hearing scheduled for Feb. 12.

The so-called debtor-in-possession loan will "avoid immediate and irreparable harm to the debtors, their creditors, their business, their employees and their assets," Black said in the ruling.

Hartmarx, based in Chicago, filed a Chapter 11 petition on Jan. 23, making it the latest victim in a string of retail industry bankruptcies brought on by a tightening credit market, rising unemployment and a deepening U.S. recession.

Hartmarx listed assets of $483 million and debt of $261 million as of Oct. 9. The company, which may sell all or part of its assets, said it already owes $113.5 million to the DIP lenders, including Wachovia, which Wells Fargo & Co. acquired this month.

Hartmarx's lawyer, George Panagakis of Skadden, Arps, Slate Meagher & Flom LLP in Chicago, didn't immediately return a call for comment.

The case is In Re Hartmarx Corp., 09-02046, U.S. Bankruptcy Court, Northern District of Illinois (Chicago).