Syms-Vornado win Filene's with $62.4 million bid
NEW YORK (Reuters) - The second bankruptcy auction for off-price retailer Filene's Basement was won on Monday by a joint $62.4 million bid by discount clothier Syms Corp (SYMS.O) and developer Vornado Realty Trust (VNO.N), a restructuring expert advising Boston-based Filene's said.
The offer beat out a rival bid by Men's Wearhouse Inc (MW.N) and Crown Acquisitions, a retail real estate investment firm, and includes the leases for 23 Filene's stores, its trade name, inventory and distribution center, said Terry Corrigan of Abacus Advisors. The Men's Wearhouse-Crown bid was for $64.9 million and included the leases to 18 stores.
Syms shares rose 13.3 percent, or 84 cents, to $7.15 late Monday afternoon on Nasdaq. Vornado dropped 4.3 percent to $46.46 and Men's Wearhouse fell 2.9 percent to $19.21 on the New York Stock Exchange.
While the Syms-Vornado bid is lower in dollar terms, the assumption of more leases means fewer creditors can make claims to the money offered, leaving more to Filene's estate, Corrigan said.
"Assuming the bankruptcy judge approves the sale, this is a transformative deal for Syms in our view, it is double barreled, for their retail business and their owned real estate assets," said Andrew Sole, a managing member of Esopus Creek Advisors, which owns about 3.5 percent of Syms common stock.
A spokeswoman for Men's Wearhouse did not immediately respond to a request for comment.
Approval of the sale is subject to a hearing set for 5 p.m. EDT (2100 GMT) Wednesday before U.S. Bankruptcy Judge Mary Walrath in Delaware.
The auction resumed Monday morning in New York after no winner emerged last week, when the auction was ordered reopened by Walrath following objections to the original sale. A Men's Wearhouse affiliate won that original auction with a $67 million bid.
Crown, which had a placed a starting bid for $22 million in the original auction, had complained that the auction was not run in accordance with bid procedures.
Filene's Basement filed for Chapter 11 bankruptcy protection on May 4.
The case is In re: Filene's Basement Inc, U.S. Bankruptcy Court, District of Delaware, No. 09-11525.
(Reporting by Phil Wahba; Editing by Richard Chang)
