Payless probing whether dividends contributed to bankruptcy: CFO

Payless ShoeSource, which filed for bankruptcy protection last month, is investigating whether its private equity owners have contributed to the company’s financial demise, CFO is reporting. Golden Gate Capital and Blum Capital Partners acquired Payless in 2012. Since the acquisition, the PE firms have received more than $350 million in debt-funded dividends from Payless, the story said. Payless filed Chapter 11 on April 4 with $838 million of debt. Payless creditors’ committee said the dividends paid to the PE firms was funded by the same secured debt that drove the debtor’s bankruptcy filing, CFO said.