It’s early days yet–but $1.14 billion Freeport, ME-based L.L. Bean is considering purchasing Redmond, WA-based rival Eddie Bauer. A purchase would double Bean’s sales and give the cataloger an instant and substantial retail presence nationwide.
The $1.4 billion Eddie Bauer is part of Downers Grove, IL-based Spiegel Group, which also mails the Newport News and Spiegel catalogs. Spiegel filed for bankruptcy protection on March 17.
“We notified the bankruptcy trustee through our Fleet Bank representative about our interest to be kept informed and learning more about the assets that might be sold,” says Bean spokesperson Rich Donaldson.
Spiegel spokesperson Debbie Koopman could not be reached for comment.
According to Donaldson, outdoor apparel and gear marketer Bean considers Eddie Bauer, which specializes in casual apparel, a significant competitor. And Eddie Bauer’s 535 stores would meet Bean’s desire to grow its retail presence. Bean has four stores in the U.S.; additional stores in Japan, Canada, and Germany; and 15 factory outlet stores.
While he wouldn’t comment specifically on how an Eddie Bauer acquisition would fit in retail-wise, Donaldson did say that “retail is one of the growth horizons we are looking into. … It’s so early in the process, we want to remain informed about the disposition of Eddie Bauer assets and how they come through the bankruptcy process. It’s fair to characterize our interest as a curiosity.”
Industry watchers think a Bean/Bauer marriage could be a success. “You put L.L. Bean in a true national retail chain, and I think it could do extremely well,” says Walter Bernheimer II, president of Wellesley, MA-based consulting firm Bernheimer Associates and a former consultant to Bean. “Mention Bean anywhere, and people have a positive reaction. And if Bean were to convert some of the Bauer stores to Bean while eliminating the weaker Bauer stores, it would be a hell of a way for a national retail presence quickly.”
“One reason there will be a lot of interest in Bauer coming out of this bankruptcy proceeding is you can buy a store brand name at a reasonable price, free of liabilities,” says Matthew Caras, a principal with Leaders, a Portland, ME-based investment banking firm. “I don’t think this will be a distress type of sale. I assume the name is of principal importance to Bean despite the overlap of the two.”