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It's been a rough month for distressed investor Sun Capital Partners as a trio of its portfolio companies fell into Chapter 11 in February. Things started off on the wrong foot as Wickes Furniture Co. filed for bankruptcy in Wilmington, Del., early this month; and after a two week lull two more of its investments, high-end gadget retailer Sharper Image Corp. and gift shop chain Lillian Vernon Corp., filed this week.
Sun doubled down on its stake in Sharper Image last May, paying $13.78 million for 1.49 million shares held in a trust set up by the company's founder and former chief executive, Richard Thalheimer. The purchase gave Sun Capital a 19.8% stake in Sharper Image, up from 9.8%. The economic slow-down seems to really be hitting retailers where it hurts. Statistics from Bankruptcy Insider reveals that 96 retailer-related companies (both retailers and restaurant chains) have filed for Chapter 11 in the last 12 months. Sun Capital, which specializes in distressed assets, will likely see more action in its portfolio if a recession hits -- not that its slowing down the Boca Raton, Fla., private equity firm, which just completed a $762 million buyout of apparel marketer Kellwood Co. and made a bid for Furniture Brands International Inc. that sent its stock soaring Thursday. - George White See Dealscape post on retailer bankruptcies CategoriesComments
From: Wes Anderson,
A new company yesterday makes it a quartet. Coleman Powrmate filed a chapter 11 on 3/17/08.
Posted on:
March 18, 2008 12:07 PM
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Don't forget Sun's ill-fated foray into First NLC with FBR that just went belly up