The two Honolulu firms will bring the discount retailer out of bankruptcy
POSTED: 10:59 a.m. HST, Nov 22, 2010
The local chain of Price Busters and Let's Party stores has agreed to be sold to two local real estate companies as part of a deal to bring the discount retailer out of bankruptcy.
Honolulu firms The MacNaughton Group and Kobayashi Group announced the plan today, saying a partnership they formed called Retail Partners Hawaii has agreed to buy substantially all the assets of ERT Sales of Hawaii Inc., which owns eight Price Busters and Let's Party stores on Oahu.
Financial terms of the sale were not disclosed in the announcement. A sale is subject to U.S. Bankruptcy Court approval.
ERT filed for Chapter 11 bankruptcy protection in January. Since then, one Price Busters store downtown has closed.
If the sale is approved, Retail Partners said it expects to retain all of ERT's roughly 270 employees.
Under the deal, ERT founder and President Beth Tom would become a consultant assisting with purchasing merchandise and training new merchandise buyers for a limited time after a sale is completed.
Tom said in a statement that she has tremendous respect for Retail Partners operators, who have been involved in retail mall development and running retail chains Blockbuster Video, Starbucks, Jamba Juice and P.F. Chang's in Hawaii.
"Price Busters has pretty much been my life over the last 18 years and it is admittedly difficult to hand the keys over to someone else, but I am doing this for all the right reasons," Tom said. "I look forward to helping the new team during the transition period and I am confident about Price Busters' future."
Retail Partners said ERT managed to continue operating eight stores, but suffered from reduced merchandise orders, in part, because vendors were concerned about supplying a company in bankruptcy.
The partnership said it is poised to provide capital and liquidity to ERT, which should give vendors confidence to ship goods and ensure shelves are optimally stocked for the holiday shopping season.
If court approval is forthcoming, the sale is anticipated to close next month.