Brand management firm makes the first bid for Brookstone

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Brand management firm makes the first bid for Brookstone

By Deena M. Amato-McCoy - 08/28/2018
The parent company of Nine West and Bandolino has its eye on Brookstone.

Authentic Brands Group, which recently purchased the Nine West and Bandolino brands from Nine West Holdings, has made a “stalking horse” bid of $35 million on bankrupt Brookstone. The proposal positions the company as a partner to maintain and maximize Brookstone’s retail business.

Based on the proposal, the money from the sale of assets could be used to pay off a proposed $30 million post-bankruptcy loan from two of the company’s pre-petition secured creditors, Wells Fargo and Gordon Brothers Financing. However, it could fall far short of covering the company’s secured debt, which totals $82 million, according to the New Hampshire Business Review.

Brookstone considers the proposal a “baseline bid and is subject to higher and better offers in an open auction process,” according to the company.

Brookstone will participate in an open action on Sept. 24. Until then, the company “continues to receive serious interest from a number of potential buyers that recognize value across the business,” Brookstone reported.

“We are pleased that Authentic Brands Group recognizes the core value of our business and has made an offer for the Brookstone brand,” said Brookstone CEO Piau Phang Foo. “For now, we are focused on continuing to serve our loyal customers through our airport, e-commerce and wholesale businesses. Brookstone is a beloved, valuable brand, and we are confident that this process will maximize value for all of our stakeholders.”

Brookstone filed for Chapter 11 bankruptcy protection in early August, listing assets of $50 million to $100 million and liabilities of $100 million to $500 million. The 45-year-old company has begun closing its remaining 101 mall stores. It will continue to operate its 35 airport stores, e-commerce and wholesale businesses as it looks to find a seller for the units.

This is the specialty gift retailer’s second bankruptcy filing. The company first filed for bankruptcy protection in 2014, and was subsequently was sold at an auction to a group of Chinese buyers backed by retailing conglomerate Sanpower Group and Hong Kong-based private-equity firm Sailing Capital before emerging from bankruptcy protection.

Brookstone blamed deteriorating mall traffic, supply chain issues, technical problems and management turnover for its recent problems.

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