Filene’s Basement Files for Chapter 11 Bankruptcy Reorganization; Agreement Reached for Sale of 17 Stores to New Operator

WILMINGTON, Del., May 4 /PRNewswire/ — Filene’s Basement today filed to reorganize under Chapter 11 of the Federal Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware.

Concurrent with the filing, the company announced that it had entered into an agreement, subject to Bankruptcy Court approval, with an affiliate of Crown Acquisitions to purchase 17 of the chain’s 25 stores, including the flagship stores in Boston and Union Square. Crown, which is based in New York, intends to continue to operate the stores under the Filene’s Basement name, while maintaining the chain’s value merchandising model.

Crown is one of the largest and most successful real estate and asset management firms in the country, with an ownership interest in more than 15 million square feet of retail and office property throughout North America. Crown previously owned and operated the Young World chain of retail stores in five states.

The contract with Crown is subject to a Bankruptcy Court auction under which additional offers for the 17 stores, the remaining Filene’s Basement stores, and other Filene’s assets will be solicited. The auction is expected to be held in approximately five weeks, subject to the approval of the Bankruptcy Court.

“This transaction provides an excellent opportunity to continue the Filene’s Basement tradition of top-quality apparel at low prices in most of the chain’s marquee locations,” said Scott Rusczyk, President of FB Acquisition II, the Buxbaum Group affiliate that acquired Filene’s Basement on April 20.

Advisors to Filene’s Basement include Alan Cohen, who was engaged as Chief Restructuring Officer, and Pachulski, Stang, Ziehl & Jones LLP, which was retained as counsel. Morris Missry and Scott Lesser of Wachtel & Masyr, LLP, and Arthur Steinberg of King & Spaulding advised Crown Acquisitions in connection with this matter.

About Buxbaum Group

Buxbaum Group, based in Agoura Hills, Calif., has built its reputation for over 30 years as one of the largest liquidators and appraisers of retail and wholesale inventories across North America. While continuing to operate in those areas, the company has shifted its primary focus in recent years to turnaround investing.

SOURCE Buxbaum Group