With about $140 million in debt and suffering sales, adult gadget retailer Brookstone is considering filing for Bankruptcy. In an effort to restructure its debt, Brookstone is considering filing a pre-negotiated chapter 11 to facilitate a sale of the company. Brookstone is probably most noted for its wide range of fancy massage chairs and other high end novelty items. It has been reported that Spencer Spirit Holdings Inc., which currently owns the Spirit costume stores and online retailer Spencer Gifts, is interested in purchasing Brookstone should it enter into a pre-negotiated chapter 11. However, Spencer Spirit Inc. may not be the only company interested in acquiring the retailer. Web search provider Blucora Inc. is ready to challenge Spencer Spirit Holdings, inc. with an all cash offer bid.
Speculation of the Brookstone bankruptcy filing follows the recent chapter 11 filings of pizza chain Sbarro and sandwich shop Quizno’s. Sbarro also filed a pre-negotiated chapter 11 reorganization to reduce its debt down hopefully by about 80 percent, in part by closing around 200 of its present locations. Quizno’s also hopes to cut their company debt load by around $400 million with the pre-structured chapter 11 filing last month.
In today’s economy, financial problems are all relative. Whether you are a national retailer with millions in debt or a minimum wage worker having trouble making ends meet, bankruptcy can potentially help you out of a difficult financial position.