With most observers predicting that it was headed for liquidation, bankrupt discount clothier Steve & Barry’s has found a buyer, according to The Wall Street Journal (subscription required).
The company has concurred to be acquired by turnaround firm Bay Harbour Management for $163, with Bay Harbour planning to operate the company as a going concern, contingent upon the ability to renegotiate leases with malls that home the company’s stores.
But it’s a little more complicated than that. Bay Harbour is the stalking horse bidder, which means that, assuming the deal secures bankruptcy court approval, the $163 million offer will serve as opening bid for an auction of the company’s assets. If no one else steps forward with a high offer — or one that is somehow superior — Bay Harbour will have its prize.
This is obviously fantastic news for the company’s employees, suppliers and other affiliates, but in a larger sense, it’s wonderful for the young people who rely on its 276 store for reasonably fashionable and fabulously inexpensive clothing — like NBA-star endorsed basketball shoes for under $10!
I’ve followed the sage of this company’s demise closely, hoping that it would pull through because of all the money it saves college students. While there’s still plenty that could go wrong, it’s looking more likely that Steve & Barry’s will pull through than it has in more than a month.
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