Scott Ruscyzk, president of FB Acquisition II says that pending a ratification of the bid from the court, it is "equally important, the agreement is expected to preserve jobs for the vast majority of Filene's 1,600-plus employees, while maintaining relationships with many of the vendors that historically sold to the chain and preventing vacancies in at least 17 of the retail properties where the chain was an anchor or subanchor tenant." FB Acquisition II is an affiliate of the Buxbaum Group, which purchased Filene's out of bankruptcy in 1999 from Retail Ventures, Inc.
Other competitors in the auction were Syms, Vornado Realty Trust and Crown Acquisitions. Crown had made a pre-auction play for 17 of Filene's stores in early May for roughly one-third the price Men's Warehouse bid. The $22-million offer did not include the Burlington and Auburn office and distribution center.
"With the inventories ultimately expected to be added into the equation, we anticipated that the auction bids would be north of $40 million. Accordingly, the winning bid was a great result," says Filene's Chief Restructuring Office Alan Cohen.
The six remaining stores in Baltimore; Elizabeth and Paramus, NJ; Hyannis, Peabody and Saugus, MA; are expected to shutter in early June. Meanwhile, the anticipated Filene's at Downtown Crossing will be under doubt until proceedings can determine the fate of not only the store, but the proposed development it was anchoring. Developer John Hynes was teamed with Voranado on the $700-million project which pulled the reigns on the project until the monetary situation could be worked out, as no construction loan had been closed at the time.
As far as Filene's Chapter 11 filing, the company hopes to have it wrapped up by the end of 2009. Men's Warehouse plans to retain the full inventory, vendor relations and the Filene's brand, under its umbrella of discount retailers.
Officially, the 17 locations which Men's Warehouse will take over are: Aventura, FL; Atlanta; Michigan Avenue and North State Street, Chicago; Chevy Chase, Rockville, MD, as well as a storage facility in Landover, MD; Columbus and Warrensvill Heights, OH; Connecticut Avenue and 14th Street, Washington, DC; Broadway, Union Square and Sixth Avenue in Manhattan, as well as Fresh Meadows and Manhasset, NY; and Back Bay and Downton, Boston, along with Braintree, Newton, Watertown, MA and of course the Distribution center in Auburn and the Burlington, MA headquarters. Filene's did not return GlobeSt.com inquiries by deadline.
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