Kramer Levin Client York Capital Management Closes Deal

On August 25 Steve & Barry’s LLC announced that BHY S&B Holdings LLC, a newly formed affiliate of investment firms Bay Harbour Management and firm client York Capital Management, has received Court approval to acquire substantially all assets of Steve & Barry’s. The acquisition is scheduled to be completed today. Co-founders of the company Steve Shore and Barry Prevor are among the investors in BHY S&B Holdings.

Under the terms of the $163 million purchase agreement, the majority of Steve & Barry’s 276 stores will continue to serve customers nationwide. In addition to acquiring merchandise inventories and transfer rights to Steve & Barry’s store leases, BHY S&B Holdings will acquire all Steve & Barry’s intellectual property rights, including its celebrity and brand licenses, and the company’s key facilities, including its Port Washington, New York headquarters, Columbus, Ohio distribution center, and certain overseas offices. The company, which sells celebrity-branded clothing for less than $11, had filed for bankruptcy protection in July citing tight credit markets and a pullback in customer spending.

York Capital Management is an employee owned hedge fund sponsor, which primarily provides its services to pooled investment vehicles. It also caters to high net worth individuals, pension and profit sharing plans, state or municipal government entities, charitable organizations, endowments, foundations, funds of funds, and institutions. The firm primarily invests in companies undergoing mergers and acquisitions, distressed and restructuring companies; special situation equity including spin-offs and split-ups; bonds; warrants; and options. Founded in 1991 and based New York City, it has offices in Washington, DC, Singapore, Moscow, London and Hong Kong.

Bay Harbour Management is known for purchasing distressed companies and overseeing their turnaround. It bought high-end apparel department store Barneys New York and then sold it to Jones Apparel Group.

Howard T. Spilko, Andrew I. Ward and Joshua R. Little worked on the transaction, with Barry Herzog providing tax advice.