Shoe manufacturer Steven Madden Ltd. is coming to the aid of a large
shoe store chain (Bakers Footwear Group) that will be profitable for
them in two ways, in addition to saving a large distribution entity
as Bakers has 239 retail stores across the country. The deal evolved
because Bakers required $5 million to settle up with Bank of
America, in addition to needing operating income.
Madden provided the loan at 11% interest over the next decade. Plus
Bakers agreed to a barter-type of agreement by providing Steven
Madden a 20% stake in Bakers, or 1.8 million shares of Bakers stock
to clinch the deal.
Editor�s
note:
This deal reminded us of the agreement super-dealmaker John Malone
of Liberty Media did with Sirius XM Radio, when �blood was running
in the street� back in 2008 and Sirius� position dictated money fast
in order to survive. Malone loaned Sirius $500 million at 15%
interest (since repaid), and in return received a warrant for
$12,500, that would convert when Malone desired into 40% of Sirius
common stock. That stock (40%) is now valued at an astounding $2.8
billion. (Malone has yet to convert the warrant.)