Reports have private equity firm CCMP Capital Advisors as the likely buyer of the company. A flailing brand image and lousy consumer spending combined with the company's $426.7 million debt load helped to drag the company into insolvency. In the first quarter of 2009, the company lost $44.5 million.
If CCMP is the eventual winner -- last week, there were rumors that Hilco Consumer Capital was the front-runner -- Eddie Bauer will be joining Vitamin Shoppe and Quizno's as a centerpiece of the company's portfolio of retail brands.
Can Eddie Bauer the brand be saved, even if it's too late for the company's current investors? Perhaps. Last week on DailyFinance, Bruce Watson explained how the company's slide was brought about by a shift away from outdoor apparel:
While the stores' move into business casual attire is bizarre, its parent company -- Eddie Bauer Holdings Inc. (EBHI) -- seems to have gone completely off the deep end. The slightly-more-rugged-than-usual Eddie Bauer baby stroller might have some tenuous link to the company that once outfitted expeditions to K-2 and Antarctica, but the branded "Eddie Bauer Occasional Table" most certainly does not. Similarly, while the Eddie Bauer Ford Expedition Eddie Bauer may be in line with the famous brand the 400-thread count Egyptian cotton percale sheets border on travesty.
With the right management in place, there should still be enough equity in the Eddie Bauer name for CCMP to make a lot of money from this deal.
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