Performance Bicycle, the Chapel Hill-based retailer, won’t close any of its North Carolina stores after its parent company filed for bankruptcy protection earlier this month, the Charlotte News & Observer reported. The retailer is closing around 40 stores total as it goes through chapter 11 bankruptcy. Advanced Sports Enterprises, the Philadelphia company that bought Performance Bicycle just a little more than two years ago, filed for bankruptcy protection on Nov. 16. The company said it took that action “to restructure and better position itself for future success,” according to a release. Advanced Sports has more than $100 million in debt, according to its bankruptcy filings.
Sears Holdings Corp. is considering offers from liquidators that would result in the closure of all its stores while Chairman Edward Lampert and Cyrus Capital Partners prepare a bid that would keep the bankrupt retailer in business, WSJ Pro Bankruptcy reported. Lampert, who believes a slimmed-down Sears can emerge from bankruptcy, and Cyrus are expected to make an offer for roughly 500 of Sears’s best-performing stores. The company’s advisers, however, have contacted a number of liquidation firms seeking offers to shut down Sears’s stores and sell off the company’s merchandise in case the takeover offer falls apart. Lampert’s hedge fund, ESL Investments Inc., and Cyrus are expected to place a credit bid, meaning they would forgive some Sears debt in return for control of the company. However, that offer would likely include cash as well as the forgiveness of debt, according to sources. Bids are due next month and a decision on the sale is expected early in the new year. Read more.
In related news, Sears is identifying 505 stores and leases that would be sold as a group early next year in an attempt to keep the brand alive, the Dallas Morning News reported. The 132-year-old retailer said that it is reducing debt and operating costs through its court-supervised reorganization, but it also needs help from shopping center owners. Sears is asking landlords for rent reductions to help it keep profitable stores open. It's not clear what will happen to stores that are open but not on the sale list. Sears has already received bankruptcy court approval to close 190 stores. Read more.
Wedding gown retailer David’s Bridal filed for chapter 11 bankruptcy protection yesterday to implement a restructuring deal reached in recent weeks with lenders, WSJ Pro Bankruptcy reported. Last week, the retailer announced it had reached an agreement with term loan lenders and substantially all of its senior bondholders and equity holders on the terms of the deal, which will see it slash more than $400 million in debt from its balance sheet. A balance sheet reworking that will preserve David’s as an operating business has support from investors that collectively hold or control roughly 85 percent of the approximately $481 million under the top-ranking loan, and roughly 97 percent of the $270 million in unsecured notes, court papers say. Term lenders will become the majority stakeholders of the business, with a 76 percent stake, assuming the votes come in as expected and the chapter 11 plan wins court confirmation. David’s admitted it had lost some market share to local bridal competitors, but blamed the bulk of its financial struggles on an overload of debt. The Conshohocken, Pa.-based retailer skipped a loan payment recently and opened talks with lenders about how to resolve a debt load of more than $900 million.
Aegean Marine Petroleum Network Inc. said on Tuesday it has received a $681 million stalking-horse bid by Swiss commodities trader Mercuria Energy Group Ltd, Reuters reported. The proposal has been filed with the U.S. bankruptcy court for the southern district of New York, the marine fuel logistics company said. Earlier this month, Aegean Marine and some of its subsidiaries filed for chapter 11 bankruptcy protection. The company said that it received a court approval granting it access to the $532 million debtor-in-possession credit facility funded by Mercuria.
A long-running dispute over the future of Toys “R” Us Inc.’s healthy Asian retail business has come to an end, WSJ Pro Bankruptcy reported. The Asian business’s proposed new owners, a group of bondholders, have reached a deal with minority owner Fung Retailing Ltd. to form a partnership to operate the business, according to a Thursday news release. When Toys “R” Us announced it would wind down its U.S. business in March, it said that it would either sell or liquidate its international entities. The Asian business was considered the most prized among them. Fung owned a 15 percent stake in the Asian business, the result of a joint venture signed in April 2017, just months before Toys “R” Us’s bankruptcy filing. Early on, the TRU Taj foreign arm of Toys “R” Us sought in U.S. bankruptcy court to invalidate Fung’s right of first refusal and sell 100 percent of the equity. Fung pushed back, arguing that it didn’t fall under the jurisdiction of U.S. courts and that bid procedures should protect its rights. A U.S. bankruptcy judge overruled the objection, but Fung appealed.
Sears Holdings Corp. won court approval to pursue a sale of its best stores, a process that would be the retailer’s only hope of avoiding liquidation, WSJ Pro Bankruptcy reported. Bankruptcy Judge Robert Drain yesterday signed off on the company’s sale timeline to sell at least 400 of its best-performing stores. The company must find a so-called stalking horse, or lead bidder, by Dec. 15, which would set the floor price for other offers. If there is more than one qualifying bid for the stores, an auction would be held in mid-January. Sears has pegged its future to the sale of these stores since its Oct. 15 bankruptcy filing. Chairman Edward Lampert’s hedge fund, ESL Investments Inc., is expected to make a stalking-horse offer. Through ESL, Lampert is Sears’s largest shareholder and creditor, and his position in the company is being placed under the microscope. Before the bankruptcy filing, he was also chief executive. The company has appointed a special committee to investigate prior transactions between ESL and Sears. In addition, the committee of unsecured creditors has taken aim at ESL, and will be performing its own investigation. Judge Drain approved this secondary investigation yesterday as well.
