Brooks Brothers is planning to sell its Golden Fleece manufacturing facility in Haverhill, Mass., for $14 million. The move appears to be part of the company’s overall strategy in bankruptcy to sell its manufacturing business separately from the rest of the business.
The company plans to sell the 148,000-square-foot facility to Eastern Opportunity Fund LLC, according to a court filing Tuesday in Delaware bankruptcy court by the retailer’s chief restructuring officer Stephen Marotta, a senior managing director at Ankura Consulting Group LLC.
A representative for Brooks Brothers declined to comment.
The company said in the filing that it had alerted roughly 350 employees at the facility of such a possibility through so-called WARN notices in mid-May. The notices, which are required under the federal Worker Adjustment and Retraining Notification Act and related state laws, are meant to inform employees of potentially impending layoffs under these circumstances. The employees, who include pressers and sewers at the Southwick Facility, are represented by the union The 187, The New England Joint Board, Unite Here.
Warren Pepicelli, manager of the New England Joint Board of Unite Here, said nonetheless that news of the impending sale came as a surprise. He added that he had been working to find a buyer to keep the factory going and the workers employed.
“We are hoping the company will sell it to someone in the garment industry who will continue to operate it,” Pepicelli said Tuesday.
Brooks Brothers has said it sought to keep its manufacturing facilities open during the COVID-19 pandemic by having them produce face masks instead. In the end, they were unable to sustain those operations because they couldn’t get the “necessary government financing or otherwise generate sufficient revenue to continue to support such operation,” according to Marotta’s filing Tuesday.
Brooks Brothers has sought to use the bankruptcy proceedings to execute a going concern sale, a process that has already drawn interest in the 202-year-old business. In its first day bankruptcy hearing this month, its advisers told the court that they had received a last-minute $80 million DIP facility offer from a joint entity of licensing company Authentic Brands Group and mall operator Simon Property Group, whose role as DIP lenders positions them well in a potential auction.
Meanwhile, a group of Italian investors is also said to be looking at the business, as WWD previously reported.
According to timelines in the Brooks Brothers bankruptcy, the deadline for bids to be submitted is Aug. 5, and an auction is scheduled to be held on Aug. 10.
Brooks Brothers said although it has sought since 2019 to sell its business, including its operating and manufacturing facilities, potential suitors have not shown interest in the manufacturing facilities.
“To date, none of the potential purchasers that have submitted indications of interest or offers have expressed an interest in acquiring the debtors’ manufacturing operations as a going concern in connection with a sale of the debtors’ businesses or otherwise,” Marotta said in Tuesday’s filing.