A group led by actor Patrick Dempsey was selected as the winning bidder for the Tully’s coffeehouse chain in a bankruptcy auction in Seattle Thursday.
Dempsey’s group, called Global Baristas, offered close to $10 million for Seattle-based TC Global Inc., which operates 47 company-owned units in Washington state and California. Another 70 locations are licensed or franchised under the Tully’s name in the Western U.S. or Asia.
The bankruptcy court must still finalize the deal, and a hearing is scheduled for Jan. 11. If approved, the deal could close as soon as the end of the month.
Dempsey, who is known for his role on the television show “Grey’s Anatomy,” which is set in Seattle, made a reference to Starbucks in a Tweet sent late Thursday: “We met the green monster, looked her in the eye, and … She blinked! We got it! Thank you Seattle!”
Starbucks was also reported to have made a bid for some of Tully’s locations.
Scott Pearson, president and chief executive of TC Global, said in a statement said the auction result was “a big win” for Seattle.
“We are very encouraged and excited that Patrick Dempsey’s commitment to Tully’s, to the company, the stores, and, perhaps most importantly, in keeping the members of Tully’s family in place as they are today,” he said.
Other bidders included investment group Kachi Partners, which had offered $4.3 million in what became the stalking horse bid. The agreement included a $200,000 “break-up fee” if a higher bidder emerged.
In December, Baristas Coffee Company Inc., the Seattle-based operator of a chain of drive-thru “sexpresso” stands manned by busty female baristas, said it planned to make a bid that would be no less than $10.4 million.
TC Global Inc. filed for Chapter 11 bankruptcy in October, blaming its rapid growth and the economic downturn. Over the past year, the chain has closed about 19 underperforming locations. The company said almost all employees have been relocated to existing units and that store sales and profitability have improved in recent weeks.
The company, however, was scheduled to appear in court again on Friday, asking for additional financing to keep the coffee shop operations open beyond the week of Jan. 12, when the company estimates the chain’s cash position will potentially go negative. TC Global has requested a third financing agreement for $175,000, and, if necessary, the option of an additional $100,000. The company has already received two bridge loans totaling $500,000.
Another potential bidder was Tully’s founder Tom “Tully” O’Keefe, a real estate developer who in December said he was considering making an offer, though he retired from the company three years ago. On Twitter last week, O’Keefe wrote, “After much consultation with my advisors, I have decided not to bid. ‘Too much hair on it,’ as they say!”
However, O’Keefe may have been involved with one of the bids on the table. He said Thursday he could not comment.
Neither the auction nor the bankruptcy will impact the wholesale and online Tully’s Coffee business, which was purchased by Green Mountain Coffee Roasters Inc. in 2009. TC Global has reiterated that it will continue to source coffee for its retail stores under existing supply and licensing agreements with Green Mountain.