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Eddie Bauer to Shutter Home

Direct Home Business Also a Victim of Chapter 11 Restructuring

Downers Grove, Ill. — The Eddie Bauer division of Spiegel, Inc., will close its Eddie Bauer Home stores as part of the restructuring of the company as it emerges from Chapter 11.

The 34 Eddie Bauer Home stores will be closed, the majority expected in the second half of this year. The company also will close its direct home business, which includes the catalog and Internet offerings. It will continue to operate its apparel and accessories specialty stores.

In 2003, Eddie Bauer ranked No. 27 on Home Textiles Today's Retailing Giants survey with estimated sales of $150 million.

In the future, the company to be known as Eddie Bauer Holdings will license its name to home furnishings vendors. Current licensees are Third Day Blinds, hard window coverings; Lowe's, paint; and Lane for furniture. The company also is looking for licensees in home textiles, home accessories and garden.

The new company will be based in Redmond, Wash., the home of Eddie Bauer, according to the reorganization plan submitted to the U.S. Bankruptcy Court in New York, The new company also will include Spiegel's interest in Spiegel Acceptance Corp. and Financial Service Acceptance Corp. When the company emerges from bankruptcy it will operate as an independent business with a board of directors independent of Spiegel.

Spiegel, which was controlled by German-based Otto GmbH, last year sold its Spiegel and Newport News catalogs to Pangea Holdings Ltd. Spiegel filed for bankruptcy in 2003.

The company expects a hearing in U.S. Bankruptcy Court on March 29.

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