JOAN & DAVID TO SELL ASSETS
Byline: Vicki M. Young
NEW YORK — Bankrupt Joan & David has agreed to sell substantially all of its assets to New England Development Leasing for $16 million in cash and the assumption of certain liabilities.
The contract is subject to bankruptcy court approval, as well as a court-supervised auction on Oct. 12 at the law offices of Hahn & Hessen.
As reported, the shoe and ready-to-wear wholesaler and retailer filed for Chapter 11 bankruptcy court protection in March. The privately held Massachusetts-based corporation, which filed under the name joan and david helpern inc., was formed in 1968. It attained strong brand recognition and popularity among consumers,and once also had a strong franchise at Ann Taylor, but Ann Taylor dropped the line in 1990 to develop its own shoes.
To make up for lost sales, Joan & David embarked on an accelerated retail expansion, but the firm ran into financial difficulties as it overexpanded.
The $16 million purchase agreement includes the Joan & David retail boutiques and outlets, concession arrangements, inventory and international trademarks. Newmark Retail Financial Advisors, representing Joan & David, arranged and structured the sale. New England is an affiliate of New England Development Company, a real estate development company.
An earlier deal, struck in July, fell through. That deal would have sold Joan & David to an investment group for $17.5 million. The investment group, International Brand Development, included as a shareholder Skender Perolli, a former Escada executive.
Joan & David, which operates 60 locations throughout the U.S., Europe and Asia, has shrunk to about a $50 million company from $80 million last year.