Bidders line up to buy Brooks Brothers out of bankruptcy

Partnership between Simon Property Group and Authentic Brands is among interested parties

346 Madison Aveue (Google Maps, iStock)
346 Madison Aveue (Google Maps, iStock)

Two suitors are competing to take over suiting stalwart Brooks Brothers after it filed for Chapter 11 bankruptcy this week.

An entity tied to Authentic Brands Group and mall owner Simon Property Group are considering a bid to buy the retailer out of bankruptcy, the Wall Street Journal reported. WHP Global, which is backed by Oaktree Capital and already holds a $75 million debtor-in-possession loan from Brooks Brothers, is also preparing an offer. The loan gives the lender a senior lien on the brand’s assets.

Both the bidders plan to retain the store’s brick and mortar presence, the Journal said. Brooks Brothers has 500 locations across the globe.

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Brooks Brothers is scheduled to appear in U.S. Bankruptcy Court in Wilmington, Delaware on Friday.

The 200-year-old chain has clothed presidents and iconic movie stars, but has struggled in recent years with the shift to more casual work wear. The coronavirus-induced shutdown made matters worse for the retailer, which has New York City stores on Madison Avenue, on the Upper East Side, Rockefeller Center and Hudson Yards.

Authentic Brands Group is one of the most active opportunistic buyers of distressed retail assets, and frequently teams up with Simon Property Group. Led by CEO Jamie Salter, Authentic Brand’s largest investor is the giant asset management firm BlackRock.

[WSJ] — Georgia Kromrei