November 24, 2008 1:23 PM
Weil Steps Up to Plate in Lenox Group Bankruptcy
Posted by Zach Lowe
The list of things consumers no longer have discretionary money to buy apparently includes salt and pepper shakers shaped like elephants.
That's probably what we can assume from today's Chapter 11 filing by the Lenox Group, which makes and sells dinner ware brands such as Gorham, Dansk, and Department 56 (The Am Law Daily admittedly had heard of only Dansk before today).
Like Lehman Brothers, Steve & Barry's, and several other bankrupt companies, Lenox tapped Weil, Gotshal & Manges as lead counsel. Alfredo Perez, a partner resident in Houston, is leading the Weil team. Perez was not immediately available for comment.
According to its filing, the company has about $264 million in assets and $238 million in debts. Lenox is asking a federal bankruptcy judge in Manhattan to approve an $85 million loan from its main lenders that will allow it to stay in business as the Chapter 11 process unfolds. As with Steve & Barry's, that process will involve an auction among interested bidders. One of the bids is already being worked out; a consortium of Lenox's main lenders has agreed to purchase most of the company's assets. In exchange, the lenders will cancel a portion of Lenox's secured loans.
The lenders will win the auction if Lenox and its legal team can't find a higher bidder, Reuters reports.
The filing comes two weeks after Circuit City, with nearly $3.4 billion in assets, filed for Chapter 11 (the electronics retail chain hired Skadden, Arps, Slate, Meagher & Flom as lead counsel). At the time, experts said it was rare for a major retailer to declare bankruptcy during the holiday shopping season. But those rules appear to be out the window as the economic crisis deepens.Make a comment