Filene's sale hearing delayed as auction continues

NEW YORK, June 15 (Reuters) - The scheduled sale hearing for bankrupt discount department store chain Filene's Basement has been postponed until Wednesday afternoon as the contested auction for Boston-area store continues.

The auction resumed Monday morning in New York so bidding could continue after no winner emerged last week, when the auction was ordered reopened by a federal bankruptcy judge in Delaware following objections to the original sale.

The sale hearing, originally scheduled for Monday, is now set for 5 p.m. EDT (2100 GMT) Wednesday, according to a motion filed by U.S. Bankruptcy judge Mary Walrath.

When bidding ended on Friday, the highest offer was a joint $64.9 million bid by Men's Wearhouse Inc (MW.N: Quote, Profile, Research) and Crown Acquisitions, a retail real estate investment firm, up $1.6 million from an earlier offer that day, according Terry Corrigan of Abacus Advisors, which is overseeing Filene's restructuring.

Discount clothier Syms Corp (SYMS.O: Quote, Profile, Research) and developer Vornado Realty Trust (VNO.N: Quote, Profile, Research) had submitted a rival $61.3 million bid, though Corrigan cautioned the amounts were not directly comparable because the bids include different stores.

Last Wednesday, the judge overseeing the case reopened the bankruptcy sale after Crown objected to the results of the original auction on June 5, which an affiliate of Men's Wearhouse, K&G Acquisition, won with a $67 million bid for Filene's trade name, 17 store leases and its retail inventory.

Crown, which had a placed a starting bid for $22 million in the original auction, had complained that auction was not run in accordance with bid procedures.

Filene's Basement filed for Chapter 11 bankruptcy protection on May 4.

The case is In re: Filene's Basement Inc, U.S. Bankruptcy Court, District of Delaware, No. 09-11525.

(Reporting by Phil Wahba; Editing by Richard Chang)