Brodkey's jewelry stores across Nebraska and in Iowa will remain open through March — and possibly longer if a buyer comes forward to rescue the 133-year-old chain as owners hope, Omaha attorney Robert Ginn said Friday.
Speaking in the wake of a bankruptcy filing this week, Ginn said that while a lead bidder indicates it will hold going-out-of-business sales to liquidate merchandise, time remains for a different buyer to come forward who could opt to keep alive some or all of the nine Midlands stores.
“Obviously, all concerned want to preserve the stores in their communities, with their employees, and the good will that has been built over the years,” Ginn said.
It will be March before legal proceedings reach the point of knowing the stores' fates, Ginn said, adding that all will remain open for business at least until then. If no better bid emerges, he said, the stores could be shuttered after inventory valued at between $2 million and $2.5 million clears.
“Until that process is completed in early March, we really don't know which way it will go,” said Ginn.
Judge Thomas Saladino, who is presiding over the Chapter 11 bankruptcy case, must sign off on any resolution to the case involving the independent chain founded in 1880.
Morris Brodkey — who had immigrated with relatives to the U.S. from Lithuania — opened the first store with one of his brothers at Omaha's 13th and Douglas Streets the year James A. Garfield was elected president of the 38 United States.
A second store was added five blocks away in 1933 during the height of the Great Depression. Some called it risky, according to the company website, but Morris and his three sons, Edward, Fred and David, had built a reputation for quality jewels, prices and services.
Their slogan, “Meet the Brodkey Boys — wear diamonds,” still lingers in memories today.
After World War II, the Brodkey boys expanded. Today, under the leadership of the third and fourth generations, the chain operates four stores in the Omaha area and others in Lincoln, Grand Island, Norfolk and Hastings, Neb., and in Des Moines.
Ginn, the corporation's attorney with Omaha's Husch Blackwell, said the economy had a depressing effect on luxury goods and that likely translated into trouble for Brodkey's jewelry stores.
“I don't think things are real great in the jewelry industry,” he said.
Ginn said employees are shaken, as expected, but were alerted about the financial problems. “The company will provide them all the comfort they can while the process goes on,” he said.
Oliver Keene, who was announced as new chief executive of Brodkey's last May, did not return a reporter's phone calls Friday.
According to bankruptcy court records, Brodkey's had determined its business was “underperforming” and that the “wind-down” or closure of its stores and sale of assets was necessary.
The company said it owed more than 50 creditors between $1 million and $10 million. Among the creditors is Salus Capital Partners, which, according to a trade magazine, lent $3 million to Brodkey's in August.
Ginn said Friday that time remained for others to outbid the “stalking horse” bid by the liquidation company, which serves as a base for offers.
“Depending on the outcome, some or all of the stores may remain open under a new owner, or a new owner may conduct a liquidation sale,” Ginn said. “We expect there will be multiple bidders.”
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