Eddie Bauer Initiates Bankruptcy Proceedings While Pursuing Store Sales
Outdoor apparel and gear retailer Eddie Bauer LLC has officially filed for bankruptcy protection in the United States and announced plans to make a similar filing in Canada, marking a significant development in the retail landscape. The company, known for its durable outdoor clothing and equipment, is taking this step as it navigates financial challenges while attempting to preserve its operations.
Store Operations Continue During Sale Process
The 220 Eddie Bauer outlets located across both the United States and Canada will remain open for business while the company actively seeks a potential buyer. This strategic move aims to maintain customer access and employee positions during the transition period. The retailer has outlined plans to sell as many of its physical stores as possible, with any remaining locations facing liquidation.
Liquidation sales have already commenced as the court process gets underway, with some locations beginning to mark down inventory by up to 60 percent last week according to reports. These sales represent the initial phase of the company's restructuring efforts as it works through the bankruptcy proceedings.
Financial Details and Corporate Structure
The bankruptcy filing, submitted in New Jersey, reveals substantial financial challenges with the company listing approximately US$1 billion in debt against US$500 million in assets. This significant debt burden has prompted the current restructuring efforts and potential sale of store assets.
Catalyst Brands, the current owner of Eddie Bauer's retail operations, has indicated that if a suitable buyer cannot be found, it will begin winding down both Canadian and U.S. operations. However, the company's e-commerce platform and wholesale businesses, operated separately by Outdoor5 LLC, will not be impacted by these proceedings. The Eddie Bauer brand itself is owned by Authentic Brands Group, which may license it to other operators in the future.
Canadian Presence and Leadership Response
In Canada, Eddie Bauer maintains 31 physical locations with distribution across several provinces: 15 stores in Ontario, six in Alberta, and six in British Columbia. These locations represent an important segment of the company's North American footprint and will be part of the sale process.
Catalyst Brands Chief Executive Marc Rosen addressed the difficult decision in a news release, stating: "This is not an easy decision, and we are grateful to Eddie Bauer's associates and customers for their loyalty and trust. We are working to minimize the impact on Eddie Bauer's employees, vendors, customers and other stakeholders."
The company's leadership emphasizes their commitment to managing the transition responsibly while exploring all available options to preserve the brand's legacy and operations where possible.
