Sacramento Bankruptcy Attorney Talks About Eddie Bauer Bankruptcy
Sacramento Bankruptcy Attorney Talks About Eddie Bauer Chapter 11 Bankruptcy
Recently, Eddie Bauer filed for Chapter 11 bankruptcy. While the bankruptcy itself did not seem like incredible news except for the fact that Eddie Bauer had a potential buyer already. A private equity buyer wanted to buyer Eddie Buer for $202 million. Eddie Bauer has secured loans totalling $240 million which would leave little for unsecured lenders. In the Chapter 11, the secured lenders can have their loans modified but only by so much as their debt is tied to some asset, like land.
However, this case has hit a wrinkle which has rised the interest of many people in the bankruptcy world. The Judge has ruled that Eddie Bauer's assets can be auctioned off individualling instead of bulk bidding. To clarify, the private equity buyer is trying to buy all of Eddie Bauer assets for $202 million. Normally, another buyer would have to beat the $202 million for all of the assets. But with the Judge's ruling, buyers could just bid for smaller assets and not have to buy everything.
The upside of this ruling is that with many interested buyers, Eddie Bauer may achieve a larger liquidation value as each of their assets is sold for the maxium value. That means creditors may get more than the $202 million currently being offered. The downside is that this may mean the end of Eddie Bauer as each buyer may just want to buy a certain piece without the Eddie Bauer label attached. This may also result in several useless or low valued assets that will have to liquidated for extreme firesale prices. This also means the private equity firm will have thier bid cancelled.
Also, the question raised is what happens if the bidding brings in a total price below the $202 million. Can the private equity firm's bid still be honored if the buyers discover that their bid is too high?
If you have a question regarding Bankruptcy please contact us at 1-800-941-6730 or visit www.bkanswers.com and we can connect you with one of our experienced Bankruptcy Attorneys. After you have spoken with one of our bankruptcy attorneys we can schedule you a free face to face appointment in our office location nearest you. Our team of Bankruptcy Lawyers can assist you with all aspects of your case. If you are have questions about filing a chapter 7 bankruptcy, a chapter 11 bankruptcy, a chapter 13 bankruptcy, lien stripping, cram down, stopping a foreclosure or wage garnishment, discharging debt, etc. we can help! We have bankruptcy attorneys located throughout California who can assist your needs. Please feel free to complete our free bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.
