ongoing-trend

Luxury gadget retailer Brookstone filed for bankruptcy to pursue a $147 million sale to Spencer Spirit Holdings, as the business has struggled to maintain brick-and-mortar sales in an increasingly competitive online market. In a related Nashville Business Journals article, it was reported that a long-term change in consumer behavior has dramatically reduced store traffic, as consumers are electing to shop and browse merchandise from home or on their mobile devices rather than entering the retail store. The result of decreasing traffic at shopping malls and other retail outlets has been a dramatic increase in store closings by some of America’s most storied retail brands, including Sears, J.C. Penney and Sbarro.

According to the bankruptcy court documents, Brookstone owes $51.1 million to a group of lenders led by Well Fargo as administrative agent, collateral agent and term loan agent under a senior secured prepetition credit facility that was amended on August 13, 2013. Novelty retailer Spencer would pay $120 million in cash and $7.5 million in new notes and assume about $18.5 million in liabilities.

A related Wall Street Journal article reported that an auction sale of company ownership is scheduled for June 2; Internet business operator Blucora is said to be preparing an all-cash bid for the company.