Eddie Bauer (A)
Paul M. Healy
Harvard Business School; National Bureau of Economic Research (NBER)
Sharon P. Katz
Columbia Business School - Accounting, Business Law & Taxation
Harvard Business School
August 24, 2009
HBS Case No. 110-008
Harvard Business School Accounting & Management Unit
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.
JEL Classification: A23
Date posted: September 5, 2009
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