Robert Bernstein, founder and former chief executive officer of Midwest retailer Beauty Brands, wants to buy the business back.
Beauty Brands filed for Chapter 11 bankruptcy protection earlier in January with a stalking-horse bid from Hilco that would liquidate inventory. On Wednesday, Bernstein filed an objection to that plan in a Delaware bankruptcy court, saying that his company, called Absolute Beauty, would assume 23 Beauty Brands leases for $4.65 million, plus inventory.
Bernstein said the company’s bid is valued at more than $10 million, while Hilco’s is around $9.3 million. The Bernstein family is asking the court for its purchase agreement to serve as the stalking-horse bid for Beauty Brands, not Hilco’s.
Plus, Bernstein said, his offer would keep 875 people employed. “Absolute Beauty’s committed and actionable offer eliminates millions of dollars in potential claims and, most importantly, keeps a viable operating business alive and well,” the court papers said.
In documents, Bernstein details the retailer’s history, saying that he and his son, David, expanded the chain to 12 states and 55 locations before selling their majority interest to Lyn Kirby, the former ceo of Ulta Beauty, and TSG Consumer Partners in 2014. The Bernstein’s still own 5.3 percent of Beauty Brands, according to court papers.
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Beauty Brands filed for Chapter 11 on Jan. 6. The business had attempted to reposition itself over the past few years, including spending to open 11 new locations, which underperformed. In January, the retailer openly talked about focusing on the hair category in order to fuel growth.
For the fiscal year ended February 2018, Beauty Brands posted $125 million in net sales.