EXHIBIT 99.1

FOR IMMEDIATE RELEASE

CONTACT:    Hanover Direct, Inc.                          The MWW Group
            Brian C. Harriss                              Jamie Schwartz
            E.V.P. & Chief Financial Officer              Rich Tauberman
            Tel: (201) 272-3224                           Tel: (201) 507-9500

     HANOVER DIRECT ANNOUNCES COMMON STOCK AND PREFERRED STOCK RESTRUCTURING
  TRANSACTION WITH RICHEMONT FINANCE S.A. AND AMENDMENT OF CONGRESS FINANCIAL
                                CREDIT AGREEMENT



WEEHAWKEN, NJ, December 20, 2001  - Hanover Direct, Inc. (AMEX: HNV) today
announced it had consummated a Common and Preferred Stock transaction with
Richemont Finance S.A. and amended its Credit Agreement with Congress
Financial Corporation.

With the transaction, disclosed in documents recently filed with the Securities
and Exchange Commission, the Company purchased 74,098,769 shares of Common Stock
and 1,400,000 shares of Series A Preferred Stock and all accrued and unpaid
dividends from Richemont Finance S.A. in exchange for the issuance by the
Company of 1,622,111 shares of Series B Preferred Stock, reimbursement of
expenses of $1 million, and a release and indemnification agreement. The new
Series B Preferred Stock does not have a dividend and is redeemable by the
Company at increasing redemption values, from $47.36 per share as of the
issuance date to a final amount of $90.11 per share at the final redemption date
of August 23, 2005. The Series B Preferred Stock has ten votes per share voting
together with the Common Stock as a single class. If all the Series B Preferred
Stock is redeemed at final maturity, the cost to the Company would be equal to
the total issue value and dividends that would have been payable on the Series A
Preferred Stock being purchased. As part of the transaction, Chairman Eloy
Michotte and Mr. Alan Grieve have resigned from the Hanover Direct, Inc. Board
of Directors.

As a result of the transaction, outstanding shares of the Common Stock of
Hanover Direct will decrease approximately 35%, from 212,468,208 to 138,369,439.
At year-end 2001, the Company will have approximately $77.3 million in
outstanding Series B Preferred Stock compared to an approximate pro forma
balance of $84.5 million had the Series A Preferred Stock remained outstanding.

Additionally, the Company and Congress Financial Corporation amended the
Company's Credit Agreement to provide for the prospective application of the
proceeds from any future asset transactions to: first, adjust the Company's
borrowings, borrowing base advance rates and credit availability under the
Credit Agreement with Congress Financial Corporation, and second, if permitted
under the terms of the amendment, provide for the potential redemption of Series
B Preferred Stock. The Company paid Congress Financial Corporation a fee of
$500,000 in connection with the amendment.

A conference call with the management of Hanover Direct, Inc. to review
these financial restructuring transactions and agreements and the ongoing
strategic business realignment program will be held on Thursday, December 20,
2001 at 11 a.m. Eastern Time.  If you would like to participate in the call,
please call 415-537-1898 between 10:50 a.m. and 10:55 a.m. Eastern Time.  The
call will begin promptly at 11:00 a.m. Eastern Time.  A re-play of the
conference will be available from 1:00 p.m. Eastern Time on December 20, 2001
until 11:59 p.m. Eastern Time on December 21, 2001 and can be accessed by
calling 800-633-8284 (Domestic) and 858-812-6440 (International) and entering
the Reservation Code 20129898#.


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ABOUT HANOVER DIRECT, INC.
Hanover Direct, Inc. (AMEX:  HNV) and its business units provide quality,
branded merchandise through a portfolio of catalogs and e-commerce platforms
to consumers, as well as a comprehensive range of Internet, e-commerce, and
fulfillment services to businesses. Hanover Brands, Inc. is comprised of the
Company's catalog and e-commerce web site portfolio of home fashions, apparel
and gift brands, including Domestications, The Company Store, Company Kids,
Silhouettes, International Male, Undergear, Scandia Down, and Gump's By Mail.
The Company owns Gump's, a retail store based in San Francisco. Each brand
can be accessed on the Internet individually by name.  erizon, Inc. is
comprised of Keystone Internet Services, Inc. (www.keystoneinternet.com), the
Company's third party fulfillment operation, and also provides the
logistical, IT and fulfillment needs of Hanover Brands, Inc.  Information on
Hanover Direct, including each of its subsidiaries, can be accessed on the
Internet at www.hanoverdirect.com.



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