NEW YORK — Wall Street trading was mixed last week.
The WWD Composite Stock Index closed the week up 0.7 percent to 1,148.29, while the S&P 500 reversed course, falling 0.3 percent to 1,201.59.
Continued uncertainty about the merger between Federated Department Stores and May Department Stores Co. did little to boost investors’ confidence. Federated dropped 1.4 percent for the week, closing at $56.72 on the New York Stock Exchange.
Shares of May rebounded after being punished two weeks ago when the company reported a 20.2 percent decline in fourth-quarter earnings. Shares were up 4.6 percent, closing at $33.45.
Meanwhile, on Friday, bankrupt Spiegel Inc. filed its reorganization plan with a bankruptcy court in Manhattan. Under terms of the plan, Spiegel’s unsecured creditors would receive 90 percent of their allowed claims through 52 percent cash and 48 percent equity in the new company. The effective date of the plan, which requires bankruptcy court approval as well as that of creditor groups, is set for late May, when the firm that emerges will be known as Eddie Bauer Holdings Inc.
Spiegel sold off its Spiegel and Newport News catalogue businesses. There is a chance that Eddie Bauer, the only remaining business, may still be sold before its exit from bankruptcy proceedings. Spiegel filed for bankruptcy court protection on March 17, 2003.
Bill Kosturos, interim chief executive officer, said Eddie Bauer has a valuation of $865 million, and while creditors are enthusiastic about owning the equity of the business, “if some company was to come up and give us a strong offer, we would have to step back and evaluate it.”
Fabian Månsson, Eddie Bauer’s president and ceo, said the company’s focus will be on apparel and accessories for men and women. The firm is looking to license its home business and expects to have around 400 stores by the end of the year.
This story first appeared in the February 22, 2005 issue of WWD. Subscribe Today.