Wikipedia/Jorge Gobbi
When bankrupt teen clothing retailer Aeropostale failed to receive bids to continue operating its business, two of its landlords — Simon Property Group and General Growth Properties — stepped in to keep the chain running.
The two mall operators banded together with liquidators to make a $243 million bid for Aeropostale, which was approved earlier this week by U.S. Bankruptcy Judge Sean Lane. Aeropostale, which was operating around 700 stores when it filed for bankruptcy in May, will be able to keep at least 229 stores operating under the new arrangement.
According to Bloomberg, Ray Schrock, a lawyer for Aeropostale, told the judge that the deal “could be a model for future restructurings in the years ahead.”
Not everyone agrees.
According to a CBS News report, Rich Moore, an analyst for RBC Capital Markets, wrote in a research note “We expect that GGP and SPG’s foray into retailer bankruptcy auctions is a one-off situation in which a sizeable number of viable stores could be salvaged from an undue conclusion.”
The deal for Aeropostale is expected to close today.