PersonalCreations.com has filed a “stalking horse” bid for select assets of direct marketer Lillian Vernon Corp. The bid was filed yesterday in U.S. District Bankruptcy court in Wilmington, DE. The court was expected to rule on the bid today, and it is likely to be approved, says Mike Muoio, Lillian Vernon’s president and CEO.
The stalking horse bid makes PersonalCreations.com the benchmark for any other bidders for an auction that will take place in three weeks, Muoio says. Once the bidding is completed, one or more of the bidders will be chosen and assets distributed accordingly, he says. PersonalCreations.com, No. 191 in the Internet Retailer Top 500 Guide, carries personalized gifts and products. The company declined to comment.
Muoio would not identify the other companies interested in Lillian Vernon’s product inventory and other assets. He said fewer than a dozen companies were involved and many had sent representatives to view Vernon’s wares.
Several of the companies have asked Muoio and other senior managers if they would remain in their positions, pending the sale. “The answer is ‘yes,’” he says. “We have a core group that has moved the company ahead very well, just not fast enough.”
Lillian Vernon, No. 59 in the Internet Retailer Top 500 Guide, filed for Chapter 11 bankruptcy protection in February, citing mounting shipping and product expenses and lower-than-expected holiday sales.