Whitehall Jewelers looks to hire Great American Group joint venture to hold store closing sales

By Caroline Salls

Pittsburgh, Aug. 7 - Whitehall Jewelers Holdings, Inc. requested court approval to hire Great American Group, LLC and its affiliates to serve as liquidation consultant to help the company conduct store closing sales, according to a Wednesday filing with the U.S. Bankruptcy Court for the District of Delaware.

According to the motion, after it held an auction on July 31, the company decided not to proceed with any of the equity liquidation bids it received.

Instead, Whitehall said it will monetize its remaining assets through going-out-of-business or store closing sales.

The company said the store closing consultation services will be conducted by a joint venture made up of Great American Group, Hudson Capital Partners and Silverman Consultants, LLC.

The joint venture will charge a fee of 2.5% of the gross proceeds of the merchandise sold.

Under the consultant agreement, the joint venture has guaranteed that the net proceeds will be at least the $68 million owed to Whitehall's pre-bankruptcy and post-bankruptcy secured lenders, provided that the merchandise to be sold is worth at least $144 million at cost.

The joint venture agreed to issue a $25 million letter of credit to benefit Whitehall's secured lenders.

The store closing sales must be completed by Dec. 31, according to the motion.

Whitehall, a Chicago-based jewelry retailer, filed for bankruptcy on June 23. Its Chapter 11 case number is 08-11261.

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