The Spiegel Group announced that, as part of its ongoing restructuring process, it has directed Miller Buckfire Lewis Ying & Co. to solicit parties who may be interested in acquiring its Eddie Bauer business. In addition, the company stated that it has reached an agreement with Pangea Holdings Limited (Pangea) to acquire substantially all the assets of its wholly owned subsidiary, Newport News, Inc.
Bill Kosturos, interim chief executive officer and chief restructuring officer of The Spiegel Group, said, “During the past 12 months we have taken targeted actions to strengthen Eddie Bauer's financial performance, closing underperforming stores and streamlining the organization, and we are pleased with the profitable financial results. We will evaluate the level of interest from potential buyers as we continue to work to develop a plan of reorganization. Based on an analysis of alternatives and negotiations with our Creditors' Committee, we believe that the value of the Eddie Bauer business can be best realized by pursuing a sale at this time.”
Under the agreement to purchase Newport News, Pangea will acquire substantially all of the assets of Newport News for $25 million in cash and assume certain liabilities. Newport News will continue to be headquartered in New York and to operate a distribution facility in Virginia.
The agreement was expected to be filed with the Bankruptcy Court Tuesday and a hearing to approve the Newport News bidding procedures is expected to be scheduled for mid-April. The Newport News transaction will be subject to all higher or better offers.
