Case | HBS Case Collection | August 2009 (Revised February 2013)

Eddie Bauer (A)

by Paul Healy, Sharon Katz and Aldo Sesia

Abstract

In June 2005, Eddie Bauer, the specialty apparel retailer, emerged from bankruptcy. Under the plan of reorganization former creditors converted their debt into common shares, taking 100% ownership in the reconstituted company. Large banks-including Bank of America and J.P. Morgan Chase-were among the former creditors. In October 2005, Eddie Bauer stock was selling for $24 per share. Analysts were projecting target prices ranging from $22 to $35 per share. Account managers at Bank of America and J.P. Morgan Chase needed to assess whether to hold or sell their shares in Eddie Bauer.

Keywords: Financial Statements; Mergers and Acquisitions; Restructuring; Insolvency and Bankruptcy; Stock Shares; Valuation; Apparel and Accessories Industry; Retail Industry; United States;

Citation:

Healy, Paul, Sharon Katz, and Aldo Sesia. "Eddie Bauer (A)." Harvard Business School Case 110-008, August 2009. (Revised February 2013.)