In bankruptcy, there's often items of value even if the company is insolvent. Barney's and Macy's, for example, are great names that would always be of value. Canary Wharf, a too ambitious real estate venture, did well after they decided not to repay the initial investors due to bankruptcy. Made the deal very advantageous to subsequent investors. Adelphia's cable operations are doing very well, thank you, as part of Comcast and Time Warner. The bankruptcy eliminated the stockholders, including the Rigas, but the cable system was fine. Same with Worldcom. It blew up and investors lost billions, but the underlying business is doing fine, ironically now part of Verizon. Webvan and eToys, however, were total liquidations.

Macy's is not thriving, as the article says at the end. Their sales are down and they have been struggling especially with all the new locations they acquired when they bought out May Co. a few years ago. Their lethargic sales are what is making them a buyout target, not the fact they are going like gangbusters.

Is there something obvious I'm missing about Lacoste. Not as big numbers wise? I would have thought it would be a no brainer to be included.

Indeed, I think the conclusion is different from the article and from Gross's previous writing on the subject. He concludes saying “[f]or truly good business ideas—even ones that are a decade ahead of their time—bankruptcy can be an operating room, not a mortuary.” Similar metaphor; bankruptcy has traditionally been considered an emergency room, not a hospice.

But that is not conclusion is not entirely consistent with what he has said in the past here (http://www.slate.com/id/21538­62/), here (http://www.slate.com/id/21618­05/), and here (http://www.slate.com/id/21622­84/).

Instead, in buying a brand name like Barney’s, buyers are getting a recognized name and brand equity Indeed, in that same paragraph, Gross says “[g]enerations of successful operation meant that the brand equity associated with Barneys and Macy's didn't simply evaporate because the firms' capital structure went bad.” In addition, these companies made or sold something tangible, rather than services; I know my coat came from Barneys, but who knows what is an Adelphia or a Global Crossing.

These brands attractive targets not because they're global icons, although they have international presences and are recognizable, but because of their cachet. Barney’s could remake itself and start selling lowbrow merchandise to the chav set, were it so inclined, much easier than could a startup. That’s why they are a bargain.

As I recall, shortly after the implosion of Webvan, Safeway went into the online grocery retail business. I haven't checked to confirm it, but as a Bay Area resident at the time, I remember hearing that Safeway had picked up the company's refrigerated delivery trucks and infrastructure at firesale prices.

So, can't say for certain... but I'm fairly sure Webvan also laid infrastructure for someone else's profits - in that case, the fixed-store competitor it's boosters thought it would destroy.