CRYSTAL BRANDS IS NEAR ACQUISITION AGREEMENT
Byline: Jeff Siegel
NEW YORK — Crystal Brands Inc. is “very close” to agreeing to be acquired by one of five potential suitors, the apparel maker disclosed at a bankruptcy court hearing Friday.
“We could have an agreement as early as [this] week,” said Alan Miller, of Weil, Gotshal & Manges, counsel to Crystal Brands, who would not divulge the name of the would-be buyer.
Miller also refused to name the two new bidders who apparently have joined the fight to acquire the assets of Crystal Brands, which owns the Gant, Salty Dog and Izod labels. The company now is primarily in men’s wear, although it maintains some women’s sportswear.
As reported, Donaldson, Lufkin, Jenrette’s Merchant Banking Group has a $125 million offer on the table, and Phillips-Van Heusen has offered $120 million. Salant Corp. is also interested, but has not made a bid.
Todd Khan, vice president /general counsel at Salant, said he had signed a confidentiality agreement and could not talk about the bidding. Representatives from Van Heusen and DLJ did not return phone calls seeking comment Friday.
Following the hearing, Miller would only say the purchase offer is in the same ballpark as those put forward by the three known bidders. The successful bidder will buy Crystal Brands’ assets, including the trade names and inventory, out of Chapter 11. The purchase of Crystal Brands’ last remaining assets would also end to its efforts to emerge from bankruptcy as an independent firm.
Miller said the two new bidders were continuing to perform due diligence in the event an agreement is not reached this week.
Also at Friday’s hearing, Crystal Brands received bankruptcy court approval to extend 60 days, to March 31, the time it has to gain acceptances to its plan of reorganization.
Unsecured creditors had unsuccessfully argued against the extension, saying Crystal Brands has ignored them in favor of its secured lender banks since the firm decided to put internal reorganization on hold.
The judge also approved about $2.3 million in fees and expenses submitted by various professionals involved in Crystal Brands’ Chapter 11 case and imposed a 15 percent holdback. — Fairchild News Service