Could Crumbs cupcakes be saved by Dippin' Dots?
Just days after the financially troubled Crumbs Bake Shops Inc. closed all 48 stores, including three at malls in the Baltimore area, the New York specialty chain stands to be acquired as part of a voluntary bankruptcy. And some of the shops, known for their oversized, gourmet cupcakes, could re-open.
The investors, a joint venture created by Dippin' Dots ice cream owner Marcus Lemonis LLC and Fischer Enterprises LLC, announced Friday they will provide financing in hopes of acquiring the chain through a bankruptcy auction.
A sale would allow Crumbs to salvage the brand by moving toward a franchise store model, Edward M. Slezak, Crumbs CEO said in a statement.
"I truly believe in the Crumbs brand and am excited to help the company enter into a new chapter in its history," investor Marcus Lemonis, host of CNBC's The Profit series and CEO of Camping World and Good Sam Enterprises, said in the announcement.
Crumbs and its new owners said they hope to reopen "select" locations or open new shops in the future. Locally, Crumbs had bake shops in Towson Town Center, the Mall in Columbia and the White Marsh Mall.
"At this point no determination has been made as to which locations would reopen," said Meg Martin, a spokeswoman for the chain.
Crumbs has said it couldn't sustain rapid expansion into 10 states as demand for high priced cupcakes weakened.
But Lemonis said opportunities lie in expanding beyond cupcakes. The new owners hope to broaden the shops' appeal and "leverage the synergies between Crumbs and other companies in my and the Fischers' portfolio," Lemonis said, including brands such as Dippin' Dots ice cream, Doc Popcorn, Wicked Good Cupcakes, Little Miss Muffin, Sweet Pete's Candy and Betty Lou's snacks.
Crumbs hopes to complete a sale, subject to bankruptcy approval, in about 60 days.
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