Brookstone nears bankruptcy, acquisition by Spencer'sBy Union Leader staff
March 27. 2014 7:30PM
MERRIMACK — Specialty retailer Brookstone, with corporate headquarters at One Innovation Way, is preparing to file for bankruptcy as a first step toward acquisition by Spencer's, another mall-based, specialty retailer.
Brookstone currently operates approximately 240 mall and airport locations.
The stores, catalog, website, and wholesale channels will continue to operate under the Brookstone brand, with current employees remaining at their locations, according to company management.
"Today marks a new chapter in Brookstone's history," said Jim Speltz, president and CEO. "While we have implemented various successful cost-cutting initiatives, the search for a strong strategic partner who shares our vision and passion was a natural progression. We think we have found that in Spencer Spirit and are excited about the opportunity to begin leveraging the resources of the two companies and popularity of the Spencer, Spirit, and Brookstone brands."
Speltz said that during the negotiations and beyond, "employees, customers, vendors, and wholesale partners can be assured that day-to-day operations will continue uninterrupted."
New Jersey-based Spencer Spirit Holdings, which owns Spencer's and costume retailer Spirit, has been in discussions with Brookstone for weeks, according to the Wall Street Journal.
"As Brookstone battles disappointing sales, weak liquidity and a hefty debt load. The two parties are hoping to finalize sale paperwork over the weekend leading up to a bankruptcy filing," the newspaper reported on Thursday, adding that Spencer Spirit Holdings is expected to pay around $120 million for Brookstone, which has about $140 million in debt.
"We see many similarities between the Spencer Spirit and Brookstone business models and are excited to begin sharing knowledge and building a strong future together," said Steven Silverstein, Spencer Spirit's CEO.
Brookstone has approximately 1,200 employees at its retail outlets and corporate offices.
The company was taken private in 2005 by a group led by Osim, Asia's biggest maker of massage chairs, in a $445 million deal.