Bankrupt fashion retailer Forever 21 has made a deal to sell most of its business for $81 million to a group of buyers that includes two of its biggest landlords.
The consortium — composed of Simon Property Group, Brookfield and licensing firm Authentic Brands Group — would get Forever 21’s remaining stores, brands and most of its other assets under the deal, which was revealed in a Sunday court filing.
Court papers identify the deal as a stalking-horse bid, meaning it would be the starting price for Forever 21 in a bankruptcy auction. Other bidders have until Feb. 7 to submit an offer before a Feb. 10 auction that will take place if competing bids come in, court records show.
Simon and Brookfield, both giant shopping mall owners, were previously in talks to take an ownership stake in the Los Angeles-based fast-fashion chain, The Post reported in September after the company filed for bankruptcy protection. Forever 21 owed Simon $8.1 million at the time of its bankruptcy filing while Brookfield was owed $5.3 million.
Now they will take over the business in conjunction with Authentic Brands Group, a licensing firm with several other fashion names in its portfolio — including the iconic luxury retailer Barneys New York, which the company bought through bankruptcy proceedings in November.
Authentic Brands also teamed up with Simon to rescue teen fashion chain Aeropostale out of bankruptcy in 2016 for $243 million.
But the trio of Forever 21 buyers could have some competition. The Chang family that founded the chain has been working to make an offer by joining up with a private-equity company, the Wall Street Journal reported, citing an unnamed person familiar with the matter.
Forever 21 planned to shutter 350 of its 800 stores around the world as it started bankruptcy proceedings. Its filing followed a rapid expansion of the chain and struggles at its physical locations.