Specialty retailer Brookstone Co. Inc. has filed for Chapter 11 bankruptcy protection a second time, saying it is seeking a buyer.
The Merrimack, New Hampshire-based company has filed voluntary petitions under chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware in Wilmington.
Brookstone said it has also started a process to close its remaining 101 mall stores, citing “continued deterioration of traditional retail mall traffic.”
However, Brookstone will continue to operate its airport, e-commerce and wholesale businesses, saying that these divisions should prove attractive to a buyer with financial resources. The company currently has 35 locations in airports across the U.S.
Founded in 1965, Brookstone is a U.S.-based product developer and retailer of wellness, entertainment, and travel products.
Brookstone previously filed for bankruptcy under Chapter 11 in April 2014. The company was later acquired by Chinese investment firm Sailing Capital and Chinese conglomerate Sanpower in June 2014. It emerged from bankruptcy in July 2014.
Brookstone joins several other mall-based retailers that have recently filed for bankruptcy, including Wet Seal, Rue21 and department store chain Bon-Ton. The business of these companies were threatened by the increasing shift toward online spending among consumers.
Brookstone said it has secured access to about $30 million in post-petition financing to support its operations during the sale and restructuring process. It will pay vendors on a priority basis for goods and services ordered and received from this point forward.
Brookstone received the post-petition financing through Wells Fargo Bank and Gordon Brother Finance Company.
The company has hired Gibson, Dunn & Crutcher LLP and Young Conaway Stargatt & Taylor as its legal advisors. Berkeley Research Group LLC is its financial advisor, while GLC Advisors & Co. serves as the company’s investment banker.
by RTTNews Staff Writer
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