An affiliate of Sun Capital Partners has purchased US apparel and home fashions retailer, Gordmans. Financial terms of the deal were not disclosed.
Gordmans, based in Omaha, Nebraska, comprises 65 value-priced retail stores, located in 16 states in the midwestern region of the US.
Florida-based Sun Capital has an existing portfolio of 16 retail assets, the firm said in a statement, including controlling interests in direct marketers; department stores; grocery, pharmacy, and convenience stores; and specialty and apparel retailers.
The deal follows close on the heels of a lawsuit filed last week by US retailer Mervyns, which named Sun Capital as part of a group of private equity firms that owned the California-based retailer and allegedly “stripped” it of its real estate assets in order to leverage the buyout.
Mervyns claimed in the lawsuit that Sun, along with funds controlled by Lubert-Adler Real Estate and Cerberus Capital Management, “siphon[ed]” valuable real estate assets away from the company to leverage its buyout, eventually forcing the retailer into bankruptcy. Spokesmen for both Sun Capital and Cerberus said at the time the lawsuit was “without merit.”
News also emerged Wednesday that bankrupt US home furnishings chain, Linens ‘n Things, could be forced to liquidate later this year, after private equity firm Cerberus abandoned its plan to buy the retailer last week. Linens ‘n Things filed for Chapter 11 bankruptcy in May this year. Leon Black’s Apollo Management acquired the retailer for $1.3 billion in 2006.
Meanwhile, private equity deals are continuing in the US retail sector. Philadelphia-based Versa Capital Management, formerly known as Chrysalis Capital Partners, announced today it had acquired the Boscov’s Department Store, following the retailer’s bankruptcy filing in August. US-based Boscov’s operates 39 stores in Pennsylvania, New York, New Jersey, Maryland and Delaware.