Eddie Bauer, set to be acquired for $286 million in a bankruptcy auction, faces a tough climb back into favor.

Golden Gate Capital, the San Francisco private-equity firm that received bankruptcy-court approval Wednesday to buy Eddie Bauer’s assets for $286 million, will soon take over a company in desperate need of a turnaround.

Bellevue-based Eddie Bauer has lost money in each of the past three years and, by its own admission, no longer has the same credibility with outdoor enthusiasts it once did.

Mark Forehand, a marketing professor focused on brand strategy at the University of Washington’s Foster School of Business, said Eddie Bauer benefits from “very high” consumer awareness, meaning people have heard of it but they don’t necessarily know what it stands for.

“It’s become like a slightly outdoor Gap,” Forehand said. “You have a brand like REI, which more clearly owns the outdoor space, and then there are brands like the Gap, which are broader in their approach. The trick for Eddie Bauer is to find its niche.”

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The sale to Golden Gate is expected to become final early next month, and the retailer said Wednesday it intends “to emerge quickly from bankruptcy as a new company positioned for success, with a well-capitalized partner, a substantially lower cost structure, little or no long-term debt and a much stronger balance sheet.”

Golden Gate plans to take Eddie Bauer private and operate it as a multichannel retailer, selling online as well as in stores. It’s expected to keep at least 300 of Eddie Bauer’s 370 North American stores and retain CEO Neil Fiske, who took over two years ago after leading a turnaround of Bath & Body Works.

Golden Gate, which manages assets worth about $9 billion, has been moving aggressively into the retail sector, buying women’s clothier J.Jill for $75 million from Talbots last month. Other holdings include the Express clothing chain and Norm Thompson clothing catalog.

“We hear about them buying a lot more than selling, so they do tend to hold onto brands,” said Tim Parry, a senior writer for Multichannel Merchant, a Stamford, Conn., trade publication. “They seem to buy brands that are ready to be built back up.”

Eddie Bauer filed for Chapter 11 protection last month in Delaware, blaming the recession and the “crushing” debt it took on as part of its 2005 emergence from the bankruptcy of then-parent company Spiegel.

At an auction in bankruptcy court last week, Golden Gate was one of three suitors bidding to operate Eddie Bauer, along with New York private-equity investor CCMP Capital and Iconix Brands, a New York-based owner of the Rocawear clothing label.

Founder Eddie Bauer opened the first store in 1920 in Seattle, selling tennis rackets and fishing tackle.

After Bauer nearly froze to death on a fishing trip in the 1930s, he designed and patented a quilted goose-down jacket, and the company became known for outfitting mountaineers.

In 1988, catalog retailer Spiegel took over Eddie Bauer from General Mills, which had owned it since 1971. Under Spiegel, the company’s focus shifted from men’s outerwear to women’s casual clothes.

The company argues that it can become profitable again by returning to its roots as an active, outdoor-oriented retailer. It says it’s leaner after significant cost-cutting in the past two years and generating better-than-expected sales for a new mountaineering line called First Ascent.

It also says it has outperformed most of its competitors on one key measure, sales at stores open at least a year.

Eddie Bauer’s same-store sales fell 5.7 percent in the three months ended Jan. 3 and 11.3 percent in the next quarter. Meanwhile, its mall-based “peer group” — Chico’s, Gap, Limited, Ann Taylor, Coldwater Creek and Talbots — fell an average 17.9 and 15.7 percent in comparable periods.

Kiwa Iyobe, a consumer-trend analyst with the New York marketing consultancy Suite 2046, said Eddie Bauer needs to focus on filling a niche, rather than try to be all things to all people.

“They probably have diluted the brand to such a degree that it’s going to be difficult to revamp,” Iyobe said. “You don’t really notice it if you’re walking through the mall. It’s just there.”

Kalen Brown, a 39-year-old mother of three from Sumner, browsed through Eddie Bauer’s Bellevue Square store last week with her mom, Maggie Bryan, of Graham. Although Brown didn’t buy anything — a recession-related cut in her husband’s overtime pay has reduced their monthly income by $1,000, forcing them to curtail spending — she considers Eddie Bauer one of her favorite places to shop.

“Half of the clothes in my wardrobe are from Eddie Bauer,” Brown said, noting that she also buys many of her husband’s clothes there. “They wash well and never go out of style.”

Among the other bidders at last week’s auction were liquidators Gordon Brothers Group and Hilco Consumer Capital, which wanted Eddie Bauer’s inventory to sell off. That Golden Gate won and plans to keep Eddie Bauer going should please Brown.

“I would definitely miss them,” she said.

Amy Martinez: 206-464-2923 or amartinez@seattletimes.com