The survival of Bon-Ton Stores Inc. suffered a blow yesterday when a bankruptcy judge denied bid-protection payments to a potential bidder that wants to keep the chain alive, WSJ Pro Bankruptcy reported. Judge Mary Walrath of the U.S. Bankruptcy Court in Delaware denied the payment of up to $500,000 to a group including New York investment firm DW Partners and landlords Namdar Realty Group and Washington Prime Group. The group had pledged to submit a bid that would keep Bon-Ton’s more than 250 stores alive. The payment would have been used toward paying the group’s fees and expenses related to the sale process. The lawyers pushing for the payment argued that the offer could keep up to 24,000 people employed. While Judge Walrath denied the payment, the consortium may still show up at Monday’s auction. DW Partners and the landlords submitted a letter of intent, which included a $128 million offer, with conditions that include the $500,000 payment and representations that some vendors are willing to stay on board with the company through its emergence. Read more.
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Occupancy issues are at the heart of many significant retail cases, as detailed in the forthcoming ABI publication Retail and Office Bankruptcy: Landlord/Tenant Rights, available now at the ABI Store.
