Jun 8, 2009 4:19 pm US/Eastern
3 Filene's Basement Stores In MA Will Close
BOSTON (AP) ―
An affiliate of Men's Wearhouse won a bankruptcy auction to buy the Filene's Basement, but not all Filene's stores will remain open.
The $67 million sale prevents the demise of a retailer well-known for brand-name discounts and its famous "Running of the Brides" annual wedding dress sale.
SOME STORES WILL CLOSE
Six stores that are not being bought will close by mid-June. Stores in Hyannis, Peabody and Saugus will be shut down. Three additional stores in Baltimore, Md.; Elizabeth, N.J.; and Paramus, N.J. will also close their doors.
Employees at those locations will lose their jobs.
A GREAT RESULT
Filene's Chief Restructuring Officer Alan Cohen said in a statement that the winning bid was "a great result," given that the company had only expected bids to be more than $40 million, including inventory.
The sale to Men's Wearhouse includes the Filene's Basement brand, up to 20 store leases, all inventory and leases for the company's Burlington, Mass., headquarters and a distribution center in Auburn, Mass. The bid includes another $5 million to cover legal costs for a lawsuit over Filene's lease at the Downtown Crossing redevelopment project in Boston.
K&G Acquisition Corp. beat out two other bidders, Crown Acquisitions and a group consisting of Syms and Vornado Realty Trust, in an auction that ended Sunday. Crown had been the "stalking horse" bidder, which means it submitted the first bid that set the minimum for the court-run auction. It originally bid $22 million to buy the trade name and store leases but not the inventory.
The bid needs final approval from the bankruptcy court judge overseeing the Filene's case. Filene's Basement entered Chapter 11 court protection in May in a Delaware bankruptcy court.
It had followed other retailers into bankruptcy amid the recession and pullback in consumer spending. Other retailers that filed for Chapter 11 protection include Mervyn's, Steve & Barry's and Linens 'N Things.
(© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
Click to enlarge
Stumble It!
Comments