Bankrupt men’s wear retailer Brooks Brothers has received a $305m takeover bid from Sparc Group, which is partially backed by Authentic Brands Group, owner of Aéropostale and Nautica.
The so-called stalking-horse bid sets the minimum price for the sale. It is subject to court approval, and higher or better offers received as part of the ongoing auction process could still emerge by the 5 August deadline.
Under the terms of the agreement, Sparc intends to purchase most of the company’s global business operations as a going concern for $305m, along with at least 125 Brooks Brothers retail locations.
Sparc Group already operates more than 2,600 retail stores, shop-in-shops and an ecommerce platform, and supports over $2.7bn in global retail sales annually. It is partially owned by Authentic Brands Group (ABG), whose 50 lifestyle brands also include Juicy Couture, Vince Camuto, Herve Leger, Barneys New York and Nine West – and was part of a consortium that recently bought the assets of US teen fashion retailer Forever 21.
Sparc is also currently involved in a stalking horse asset purchase agreement to buy most of the assets of denim specialist Lucky Brand Dungarees.
200-year-old New York based Brooks Brothers filed for Chapter 11 bankruptcy protection earlier this month after being hit by falling sales and declining demand for its business attire. The privately held company is also shuttering 51 of its 250 US stores.
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By GlobalDataAccording to Neil Saunders, managing director of GlobalData Retail, “there will be no shortage of interest in Brooks Brothers. The brand has a solid foundation on which a new owner can build, and it has a good digital business that has the potential for future growth. However, the process of reinvention will not be easy; it will take time, capital and effort to reconfigure Brooks Brothers into a retailer ready to serve the needs of modern consumers.”
A court hearing to approve the stalking horse bid and bidding procedures will take place on 3 August. The deadline for competing offers is set for 5 August, and a hearing to approve the sale will take place on 11 August 2020.
