Mall Owner Simon and Authentic Brands Make $305M Bid for Bankrupt Brooks Brothers
SPARC LLC, a full-service retail operator comprised of the U.S. mall owner Simon Property Group and the apparel licensing firm Authentic Brands Group (ABG), has made a $305 million bid for bankrupt Brooks Brothers, according to a court filing published last week. The offer, still subject to better and higher bids and court approval, will keep at least 125 of Brooks Brothers’ stores open for business, the filing said. A court hearing to approve the bid has been set for Aug. 3, while other competing offers are due by Aug. 5, according to the filing. A hearing to approve the final sale of Brooks Brothers’ assets is set to take place Aug. 11. WHP Global, a rival to ABG, is also preparing a bid for Brooks Brothers, the company told CNBC. Brooks Brothers filed for Chapter 11 bankruptcy court protection from creditors on July 8. At the time, it had 250 locations in North America. Rent had become a burden for the iconic retailer, and the disruption from the coronavirus pandemic expedited a sales process that started in 2019.
Total Retail's Take: This news announced last week isn't a huge surprise, as America’s biggest mall owners, including Simon, are increasingly looking to do deals to salvage retailers hit hard by the coronavirus pandemic, CNBC has reported. Mall owners are increasingly trying to combat the issue of vacant storefronts. Dozens have filed for bankruptcy protection, including J.C. Penney, Neiman Marcus, J.Crew, New York & Co. parent company RTW Retailwinds, and Ann Taylor parent Ascena Retail Group. This isn't the first time Simon and ABG have worked together, either. ABG, which has expertise in manufacturing and licensing, and Simon, which specializes in retail real estate, have together put up a bid of $191 million for the bankrupt denim maker Lucky Brand. That offer is still subject to court approval. And before SPARC was formed, ABG and Simon came together in 2016 to buy the teen apparel retailer Aeropostale out of bankruptcy.
