A bankruptcy judge approved the sale of nearly 200 David’s Bridal stores out of bankruptcy to Cion Investment Corp., WSJ Pro Bankruptcy reported. In her bench ruling approving the sale, Hon. Christine Gravelle with the U.S. Bankruptcy Court in Trenton, N.J., said the transaction, which is set to close next week, would maximize the value for the creditors, while saving thousands of jobs and keeping up to 195 stores open. “Without the sale, there’s no way that this debtor would reach…the levels of return [for the creditors] that will be produced by the sale that’s backed by Cion,” the judge said. “We were a thread away from liquidating” just weeks ago, said Bradford Sandler of Pachulski Stang Ziehl & Jones LLP at the hearing. But the deal came together after landlords gave concessions and made it happen in a last-ditch effort, Sandler said. As part of the agreement, Cion, a publicly traded investment firm, has agreed to take over certain existing liabilities and pay for the costs to cure contract defaults and breaches, according to the asset-purchase agreement. The purchase price wasn’t disclosed.
Occupancy issues are at the heart of many significant retail cases, as detailed in the ABI publication Retail and Office Bankruptcy: Landlord/Tenant Rights, available at the ABI Store.