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ABG and Mall Giant Emerge as Winning Bidders for Bankrupt Brooks Brothers

The venture backed by Authentic Brands Group LLC and Simon Property Group Inc. has agreed to snap up Brooks Brothers Inc.

The bankrupt menswear retailer announced yesterday that ABG and SPARC Group LLC — an enterprise created by the brand management firm and the mall giant — were selected as the winning bidders in its competitive sale process. The bidders had increased their offer to $325 million for the “vast majority” of Brooks Brothers’ global business operations as a going concern, as well as its intellectual property portfolio.

As part of the agreement, SPARC plans to preserve the Brooks Brothers brand and continue operating at least 125 of the chain’s stores.

The proposed transaction is still subject to court approval and customary closing conditions. A hearing to approve the sale is currently scheduled for Friday, and the transaction is expected to be completed by the end of the month.

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Two weeks ago, SPARC made a stalking-horse bid of $305 million for Brooks Brothers, which filed for Chapter 11 protection in early July amid the coronavirus pandemic and a shift to casual office attire.

The storied American clothier operates about 250 stores in North America and planned to shutter just over 50 locations as a result of the COVID-19 health crisis, which forced widespread closures across the retail sector. As governments ease lockdown restrictions, the New York-based brand has proceeded with its reopening plans. It has more than 500 stores around the world, as well as maintains wholesale partnerships with department stores including Nordstrom and Macy’s to sell its collections.

ABG and Simon had previously joined forces — along with mall owner General Growth Properties, now owned by Brookfield Property Partners — to save Aéropostale from liquidation in 2016. The two, plus Brookfield, also became the new owners of teen mall staple Forever 21 in February. ABG is also among the parties said to be considering a buyout of Ann Taylor parent Ascena Retail Group, which filed for Chapter 11 protection in late July, as well as the potential acquirer of bankrupted JCPenney.

Michael Atmore; Iris Apfel; Ron Fromm, Sponsored By FFCF

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