Versa's bid includes assuming about $184 million in Boscov's debt and payment of a number of fees. But the Philadelphia equity firm's $11 million in cash would give vendors only about 12.2 cents on the dollar for the $90 million they were owed when Boscov's declared bankruptcy Aug. 4.
That is partly the reason at least one creditor was intrigued by the buzz that Boscov family members were preparing their own offer to buy back the 49-store chain, which is being shrunk through going-out-of-business sales to 39 stores by mid-October, as part of a hoped-for reorganization plan.
"We've heard that the family's very interested in maintaining control," said Warren C. Gerber Jr., financial-services manager for New York-based Phillips-Van Heusen Corp., which was owed $1.3 million when Boscov's declared bankruptcy.
Gerber and others representing Boscov's largest creditors said there was hope that Versa's lead bid would provoke more generous offers between now and the Oct. 10 bid deadline. Boscov's has asked to schedule the auction for Oct. 13.
The auction process was initiated yesterday when Boscov's asked the court to name Versa its lead bidder, or "stalking horse," to get things going - a standard procedure in bankruptcy cases. Negotiations with Versa had been ongoing for at least six weeks.
Like other creditors balancing the desire to get paid against the alternative - the fear that Boscov's would disappear through liquidation - Gerber said his company supported the family's efforts to keep the chain running.
Gerber, whose company sells Arrow, Geoffrey Beene and Calvin Klein apparel, said it was too soon to know how Boscov and Lakin family members might structure a deal. He said that anything could happen between now and mid-October.
"You don't know what sort of alliances might take place behind the scenes," Gerber said.
