RTW Retailwinds Inc. has scored a larger bid for its online business.
The New York & Company parent announced today that it has entered into an asset purchase agreement with Saadia Group LLC, the winning bidder in a bankruptcy auction conducted on Friday.
As part of the deal, the company will sell its e-commerce platforms and all related intellectual property for $40 million in cash, plus the assumption of certain liabilities, including the honoring of gift cards. It is subject to final approval by the court, with a hearing scheduled on Thursday.
The move surpasses RTW’s prior agreement with stalking-horse bidder Sunrise Brands LLC, which put forth early this month a $20 million bid for the IP and websites of New York & Company (www.NYandCompany.com) and Fashion to Figure (www.FashiontoFigure.com), as well as their rental subscription businesses at www.NYandCompanyCloset.com and www.FashiontoFigureCloset.com. (RTW is expected to pay a break-up fee to Sunrise Brands associated with the termination of their deal.)
“We are extremely pleased to have received a new, significantly higher priced purchase agreement from Saadia Group for our e-commerce business and all related intellectual property and certain other assets,” RTW CEO Sheamus Toal said in a statement today. “Similar to our previous agreement, the new agreement will allow our substantial e-commerce business to continue to operate and serve our loyal customers.”
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He added, “I remain deeply thankful to our associates, business partners and our many loyal customers for their unwavering dedication and commitment to the process, and we look forward to receiving final approval in the very near future.”
RTW Retailwinds filed for Chapter 11 protection in mid-July following weeks of speculation amid the coronavirus pandemic. As part of bankruptcy proceedings, the company plans to shut down its entire brick-and-mortar fleet in an “efficient and timely manner,” with New York & Company already hosting going-out-of-business sales at its nearly 380 stores.
According to financial and advisory services firms B. Riley Financial Inc., through its affiliate Great American Group, and Tiger Capital Group, the liquidations are expected to last about eight to 10 weeks from the end of July or until all products are sold. A previously filed motion showed that RTW Retailwinds plans to terminate all of its roughly 1,225 store associated at the end of the store-closing process. It received approval for a $1.2 million store bonus program to incentivize employees to stay on through the completion of the liquidation.