Exterior view of a Bon-Ton store

Soon The Bon-Ton Stores Inc. will no longer be part of the retail landscape.

As expected, a group of liquidators working with the holders of the retailer’s 8.0 percent Second Lien Secured Notes due 2021 has submitted the winning bid for the bankrupt debtor’s assets. A bankruptcy court hearing in Delaware will hold a hearing Wednesday to approve the auction results.

Bill Tracy, president and chief executive officer, said, “While we are disappointed by this outcome and tried very hard to identify bidders interested in operating the business as a going concern, we are committed to working constructively with the winning bidder to ensure an orderly wind-down of operations that minimizes the impact of this development on our associates, customers, vendors and the communities we serve.”

Great American Group and Tiger Capital Group are the two liquidation firms that will handle the going-out-of-business sales at the retailer’s stores. Most GOB sales average ten to twelve weeks after the start date.

Bon-Ton filed a voluntary Chapter 11 petition in February for bankruptcy court protection in Delaware. At the time, Bon-Ton said it had tried marketing the company to potential buyers. While the company in a regulatory filing with the Securities and Exchange Commission set out a turnaround plan that company executives believed was doable, what Bon-Ton really needed was an investor that could help fund its restructuring.

Over the last few weeks, Bon-Ton was in discussions with two landlords and a hedge fund that it hoped would buy a substantial portion of its assets to keep the company in operation. The parties were able to get a Letter of Intent in place, but weren’t able to ever execute the final terms of an agreement. The hope that Bon Ton could exit bankruptcy proceedings faded last Wednesday when a Delaware bankruptcy judge denied a request for a $500,000 “work fee” so the parties could continue their discussions and for the potential buying consortium to do their due diligence.

On Monday, the only ones at the table at a bankruptcy court-approved auction of the retailer’s assets were liquidators.

Bon-Ton operates nearly 250 stores. The company previously said it would shutter 42 stores, and now an additional 200-plus locations will go dark by Aug. 31. The retailer operates stores under the nameplates Bon-Ton, Bergner’s, Boston Store, Carson’s, Elder-Beerman, Herberger’s and Younkers. The stores and e-commerce sites will remain in operation while the store closing sales are ongoing.


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