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Brookstone names Bluestar as stalking horse after improved bid
New York, Sept. 7 – Brookstone Holdings Corp. named Bluestar Alliance, LLC as the stalking horse bidder for its assets after Bluestar increased its proposal.
The U.S. Bankruptcy Court for the District of Delaware had approved that designation at a hearing on Thursday, according to a news release.
Bluestar’s improved offer includes an option for Bluestar to select a transaction that would keep up to 50 existing Brookstone stores open, with a penalty of $400,000 payable if Bluestar either does not select this option or selects it and fails to keep at least 30 stores open, the company said.
The new offer is worth $56.35 million, made up of $50.45 million in cash and at least $5.9 million of value in the form of readily salable inventory.
Bluestar’s previous offer was valued at $43 million, according to Brookstone. As previously reported, Bluestar filed a statement with the bankruptcy court making a bid of $40 million.
Before Bluestar made its first offer, Brookstone had intended to name Authentic Brands Group, LLC as stalking horse with a bid of $35 million.
“This agreement with Bluestar is an indication of the value of Brookstone’s cherished brand, and we are particularly encouraged by Bluestar’s enthusiasm to seriously consider a bid that includes operating Brookstone retail outlets,” said chief executive officer Piau Phang Foo.
“We continue to see interest in our company from multiple potential buyers. During this time, we remain focused on serving our loyal customers, and we are grateful for the support of our dedicated employees.”
An auction for the assets will be held on Sept. 26. Competing bids are due by Sept. 20.
Brookstone, a Merrimack, N.H.-based specialty retailer, filed bankruptcy on Aug. 2. The Chapter 11 case number is 18-11780.
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