Forever 21 Submits Bid to Buy 17 Gottschalks Stores Out of Bankruptcy
Forever 21 has made a bid
to purchase 17 Gottschalks stores out of bankruptcy court for $17.7 million.
According to court documents filed on May 21 in U.S. Bankruptcy Court in Delaware, the Los Angeles-based retailer is the stalking horse bidder for the properties, which range geographically from Hemet, Calif., to Anchorage, Alaska.
If the deal is approved, Forever 21 Inc. would buy three California locations outright and assume the leases on 14 other Gottschalks stores. The Fresno, Calif.-based department store chain filed for Chapter 11 protection on Jan. 14, the same day that Goody's Family Clothing Inc. entered Chapter 11 for a second time. Goody's has since been liquidated.
A consortium of liquidators including Great American Group, Tiger Capital Group, SB Capital Group and Hudson Capital Partners is winding down operations at 58 Gottschalks stores in six Western states.
It would not be the first time Forever 21 has expanded through the insolvency of a competitor. In December, the company placed a similar bid on 15 former Mervyns locations when the California department chain was in bankruptcy.
Forever 21 is continuing to expand, despite the recession. It currently operates more than 450 stores.
