D-K Booksellers is Dead; Long Live DK Booksellers
In a nail-biter to the very last page, the sale of the Memphis Davis-Kidd comes to happy conclusion
A week ago, Memphis readers were stunned to learn that Gordon Brothers—the same California-based liquidation company currently in the process of dismantling more than 200 Borders stores nationwide—had bought the sole remaining Davis-Kidd Booksellers in order to sell off its assets. But an eleventh-hour deal will keep the store operating as a hub for Memphis book-lovers: yesterday a bankruptcy judge in eastern Kentucky approved the sale of Davis-Kidd to yet another new owner, who promptly announced the store's new name: DK Booksellers.
In truth, it's not really a new owner (nor much of a new name), but the tale is convoluted. Here's the SparkNotes version:
Late last fall, when the Joseph-Beth Group, the Cincinnati-based parent company of Davis-Kidd, filed for bankruptcy protection, it closed the Nashville store, along with three others in the chain; the Memphis store remained open during negotiations with publishers and Joseph-Beth's other creditors for concessions that would allow the company to restructure successfully. Even after those negotiations failed and president Neil Van Uum announced the auction of the five remaining stores, hopes were high that Davis-Kidd could be saved. That's because Van Uum himself had gathered investors—including the landlords of Davis-Kidd in Memphis and Joseph-Beth in Lexington, Kentucky—who were willing to back his bid on the stores. (That's right: Van Uum planned to bid on the remaining stores in his own bankrupt chain. Bankruptcy law is... interesting.)
"I've put 25 years into this, and I'm prepared to win it."
Everyone involved expected, or at least desperately hoped, that Van Uum's plan would be successful. "Hopefully this is just a bump in the road and we’ll keep on keepin’ on!" one Davis-Kidd staffer told Chapter 16 last week. With the financial investment of the two landlords, Van Uum believed, the stores would be in good shape for a new, streamlined company to begin rebuilding. "I've put 25 years into this, and I'm prepared to go into this and win it," Van Uum told the Lexington Herald-Leader prior to the auction.
But the auction, held last Wednesday in the Cincinnati offices of Joseph-Beth's attorneys, did not go according to plan. "In a shocking turn," wrote the Herald-Leader, "the management of The Mall at Lexington Green pulled financial support from the founder of Joseph-Beth Booksellers and outbid him for the bulk of the well-known book chain at its bankruptcy auction." At the end of the day, Robert Langley, the Lexington mall owner, had bid successfully on the flagship Joseph-Beth store in Lexington, plus two smaller stores in Cincinnati and Cleveland; liquidators won the bid for Davis-Kidd in Memphis, along with a Joseph-Beth store in Fredericksburg, Virginia. In a subsequent deal, the Fredericksburg store was transferred to the Books-A-Million chain while Davis-Kidd seemed destined for dismantlement.
Then, in a new twist almost immediately following the auction, Langley's new company—Booksellers Enterprises, hastily formed for the purpose of outbidding Van Uum for the Lexington store, which anchors the mall Langley owns—appeared to be making a new offer on Davis-Kidd. On Monday, according to the Memphis Commercial Appeal, a representative for Booksellers Enterprises floated the idea of buying David-Kidd from its new owners, Gordon Brothers.
Naturally, there was a hitch: no formal offer would be made to save the store without lease concessions from the Laurelwood Shopping Center's owner. "We tried to reach out to the mall (Laurelwood) ownership prior to the closing of the auction and work out a deal, but were rebuffed," Mark Wilson, chief operating officer of Joseph-Beth told The Commercial Appeal. If the Laurelwood management would deal, it would still be possible to save Davis-Kidd before the hearing—set for yesterday morning in Lexington—to certify the results of the bankruptcy auction.
"We’re still hopeful something can be worked out. We’ll see."
Hopes in Memphis soared. Eddie Burton, manager of Davis-Kidd, was overwhelmed by the outpouring of customer support that flooded the store as its fate was being considered behind closed doors all weekend: "The customer response here as been both emotional and intense," Burton told Chapter 16 on Monday. "We’re very lucky to have such loyal, caring customers, and the booksellers who have forged such special relationships with them over the years. We’re still hopeful something can be worked out. We’ll see."
Tuesday brought another whiplash turn. "No deal to save Davis-Kidd" read the headline in The Commercial Appeal after negotiations broke down Monday between Tom Prewitt, president and an owner of Laurelwood Shopping Center in Memphis, and Booksellers Enterprises, the new owner of what was left of the Joseph-Beth Company. "The scheduled conference call yesterday did not take place,” an attorney for Booksellers Enterprises told The Commercial Appeal.
Then, in an another entirely unexpected—but this time welcome—twist, Neil Van Uum sent a press release Wednesday morning announcing that he had bought the Memphis store himself from Gordon Brothers, the liquidation firm, evidently with the help of Tom Prewitt of Laurelwood. Van Uum had lost the Lexington store when his landlord pulled financial support and bid against him; now the Memphis store would be saved through the financial support of a different landlord.
"You want community, this is it."
The Davis-Kidd name, like the three remaining Joseph-Beth stores, now belongs to Booksellers Enterprises, so the Memphis store, though recognizably the Davis-Kidd of old, will henceforth be known as DK Booksellers. "I want to first apologize for all that my staff here at the store has had to endure," Van Uum wrote in a statement. "This has been a hugely trying 6 months and looked like it was very much headed to a tragic conclusion. Thankfully, with the support of Tom Prewitt, the owner of Laurelwood Shopping Center, we were able to save the store. I am excited about the future direction of our store. Eddie Burton and his team are ready to step up and take the store forward. We are fortunate to come through this well positioned financially and look forward to getting our inventory back in shape. In addition, we have plans coming together for a complete remodel of the store in the fall." In an interview today in Publisher's Weekly, Van Uum suggested that he's also interested in buying back the Davis-Kidd brand—and possibly opening another store in Nashville: "That may be something we’ll set our sites [sic] on."
Despite its reprieve, of course, DK Booksellers faces significant challenges in the age of Amazon and e-books, but there's real hope for this store. Even in a bad economy for books, the folks at Davis-Kidd Booksellers seemed to do everything right. As John Branston, author of Rowdy Memphis, noted in the Memphis Flyer, "The location is prime. The parking is free. The hours span breakfast and dinner. You want community, this is it."
[For more updates on the literary life in Tennessee, please visit Chapter 16's News & Notes page, here.]
Published Thursday, 28 April 2011