Filene’s Basement (Wilmington, Del.) has filed to reorganize under Chapter 11 of the Federal Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware.
Concurrent with the filing, the company has agreed to sell 17 of the chain’s 25 stores to an affiliate of Crown Acquisitions (New York), including the flagship stores in Boston and Union Square. Crown intends to operate the stores under the Filene’s Basement name, while maintaining the chain’s value merchandising model.
“This transaction provides an opportunity to continue the Filene’s Basement tradition of top-quality apparel at low prices in most of the chain’s marquee locations,” says Scott Rusczyk, president of FB Acquisition II, the Buxbaum Group affiliate that acquired Filene’s Basement on April 20.
Crown, a real estate and asset management firm, has ownership interest in more than 15 million square feet of retail and office property throughout North America. The contract with Crown is subject to a Bankruptcy Court auction under which additional offers for the 17 stores, the remaining Filene’s Basement stores, and other Filene’s assets will be solicited. The auction is expected to be held in approximately five weeks.