Brooks Brothers’ Bankruptcy Path
Brooks Brothers’ first week in bankruptcy court, marked by a last-minute switch of debtor-in-possession financing lenders, shows how the retailer may be gearing up for a possible going concern sale.
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“It’s an interesting change in retail bankruptcies that the landlord is entering the process very early on by providing the DIP loan, as opposed to waiting until later in the case to assist the company coming out of the bankruptcy,” said Joel Shapiro, partner at Blank Rome LLP, who represents companies in bankruptcy proceedings. Shapiro is not involved in the Brooks Brothers case and spoke generally.
“And it remains to be seen why they’re doing it at this early stage, and we will see that play out during the case,” he said.
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“Brooks Brothers’ Bankruptcy Path,” by Sindhu Sundar was published in WWD on July 15, 2020.