The bidding battle that has ensued over gaining ownership of bankrupt chain Filene's Basement, is sure to go down in retail history. After weeks of settling agreements and attempting to outbid each other, all three prospective owners—Men's Wearhouse, Crown Acquisitions, and a team of retail giant Syms and Vornado Realty Trust—were beaten down, battered, and seemingly ready for it all to be over. Yet when a winner was announced, an affiliate for Men's Wearhouse called K&G Acquisitions, the other two contenders would not go quietly. Accusing Men's Wearhouse of failing to follow court-approved procedures, both losing companies demanded a bankruptcy court hearing where their grievances could be heard.
The hearing took place last week and resulted in yet another round of an already neverending auction. This time, however, there were some unexpected alliances. After bashing Men's Wearhouse and it's formerly victorious bid of $67.7 million, Crown Acquisitions surprised everyone by forming a partnership with the men's retail company for the final round of the auction. The two businesses together submitted a $64.9 million bid and expected another victory over Syms and Vornado's $62.4 million bid.
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The latter companies, however, emerged with the winning offer. In a final twist befitting of a daytime drama, the dark horse contenders came out on top with a lower bid, yet one that included many more units than the MW/Crown offer. Filene's reps seem to consider the Syms proposition a better one and awarded Syms and Vornado with 23 formerly Filene's Basement units. The sale is fitting, since Vornado is the landlord of the stalled Downtown Crossing redevelopment project in Boston, where Filene’s had planned to reopen a store. The realty trust been paying Filene’s $500,000 a month since January as compensation for not opening the store on schedule. Syms has not disclosed yet what it will do with it's newly obtained leases.
Article Source: WWD
Photo Source: syms.com, bostonherald.com