A hot retail company that suddenly closed its doors just got a second chance

In early January preppy clothing and gift retailer C. Wonder announced it was closing its doors.

The company laid off employees, closed all of its stores, and filed for Chapter 11 bankruptcy.

In a surprising turn of events, Xcel Brands announced today that it is acquiring C. Wonder.

The brand management company will take ownership of the company founded by billionaire Chris Burch, including its intellectual property rights, trademarks and related designs, according to a press release.

Xcel is a relatively young company as it was founded in 2011. Some of the brands it owns and manages include Isaac Mizrahi, Judith Ripka, and H Halston. Another popular brand, Liz Claiborne New York, is designed and distributed through Xcel.

Ater the Chapter 11 filing, Burch Acquisition, LLC acquired the label, "in order to explore strategic opportunities to re-develop and expand the C. Wonder brand," according to the release.

Burch struggled in previous years to differentiate his label from ex-wife Tory Burch's namesake retailer. This led to a lawsuit in 2012 in which Tory accused her ex-husband of copying her designs.

The two eventually reached a confidential settlement, which allowed Chris Burch to continue building his brand.

C. Wonder evolved into an affordable retailer with bright hues, preppy aesthetics, and traditional styles.

In 2014 it was named one of the top accessories companies by Morgan Stanley.

However, late last year when the brand started experiencing trouble it resulted to discounting merchandise even further in a bid to save the company, which was not successful.

The news of the acquisition is promising for the future success of C. Wonder. Few details are available on Excel's future plans for the brand, but it will reveal more when the board approves the closing of the acquisition.