Recent reports that Spiegel is taking Eddie Bauer off the selling block are “a little misleading,” James Brewster, chief financial officer of the Downers Grove, IL-based company. Redmond-based Eddie Bauer is still very much for sale, but Spiegel’s bankruptcy reorganization plan will take into account that the cataloger/retailer may not be sold since no deal is imminent. Spiegel has until Jan. 5 to convince its creditors to back its reorganization plan. It could then take as long as March 8 to get the plan approved by all the creditors and the bankruptcy court.
Spiegel, which has been operating under Chapter 11 since March 2003, was hoping to fetch $1 billion for Eddie Bauer, but bids had reportedly stalled in the $600 million-$800 million range. Brewster would not confirm any bids or suitors for the unit, but says an Eddie Bauer sale could still happen even if the reorganization plan offered Spiegel creditors equity in the cataloger/retailer. Spiegel must estimate the value of the company in its bankruptcy reorganization plan filing, so there is nothing to stop a potential buyer from making an all cash offer that exceeds the company’s valuation of Bauer, he says.