Spiegel Seeks Buyer for Newport News

In an announcement that surprised no one, Spiegel Group on Sept. 9 said it has retained investment bank Miller Buckfire Lewis Ying & Co. to find a buyer for its Newport News women's apparel catalog. Downers Grove, IL-based Spiegel, which has been operating under Chapter 11 bankruptcy protection since March, also owns cataloger/retailer Eddie Bauer and its eponymous general merchandise catalog.

"The decision to gauge market interest in one of the company's assets, in this case Newport News, is a normal part of a Chapter 11 proceeding,” Bill Kosturos, Spiegel's interim CEO/chief restructuring officer, said in a statement. “We will evaluate the level of interest, taking it into consideration as we work to develop a plan of reorganization.”

According to Stuart Erickson, principal at Miller Buckfire, no time frame has been set for the divestiture. He says that the company will be talking to a number of financial and strategic buyers.

The decision “was inevitable,” says Craig Battle, managing director of Princeton, NJ-based investment bank Tucker Alexander. “If Spiegel is to emerge from bankruptcy, the company must raise some capital” and “shrink down the focus of the business.”

In May, $1.14 billion Freeport, ME-based L.L. Bean made news by saying it was considering purchasing Eddie Bauer. But Spiegel denied that the business was for sale.