Furniture Brands Chapter 11 Hits Snag over $6 Million Fee

By Bill Esler | Posted: 10/01/2013 11:00AM

 

An objection was filed by Furniture Brands International's bankruptcy court trustee over a $6 million fee - the amount to be paid to Oaktree Capital Management if it is unsucccessful in its bid to acquire the maker of Broyhill, Hickory, Thomasville, La Barge, Maitland-Smith, Pearson, Lane, Drexel Heritage, Lane Venture, henredon and Lane Furniture labels.

St. Louis-based Furniture Brands International, which once boasted sales of $2 billion, filed for bankruptcy Sept. 9 in Delaware Federal Court.

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In a Sept. 17 SEC filing, Furniture Brands said it was authorized by the court to pay off current lenders - General Electric Capital, Bank of America, and Wells Fargo Bank - with funds from Oaktree Capital Management, which is providing $140 million in debtor-in-possession financing.

But on Sept. 26, the U.S. Trustee for Furniture Brands bankruptcy, Roberta DeAngelis, objected to fee agreement that gives $6 million to Oaktree in the event its bid to acquire Furniture Brands doesn't materialize. The voluminous numbers of filings in the massive bankruptcy make for a tangle of information. Furniture Today established a channel to report on the Furniture Brands case.

That possibility grew more likely as a creditors committee approved a higher, competing bid for Furniture Brands from KPS Capital Partners.

The creditors committee told the court that KPS Capital Management, which made an offer of $225 million on Sept. 11, should be allowed to buy Furniture Brands, according to the creditors committee report reviewed by WoodworkingNetwork.

Furniture Brands bankruptcy, filed Sept. 9 in Delaware Federal Court, lists hundreds of suppliers and subcontractors as creditors,  The furniture maker's travails have affected many subcontractors and suppliers, listed in a 1700-page creditors list. 



 

About the Author

Bill Esler, Woodworking Network, WMS

Bill Esler

Bill Esler, Editorial Director, Woodworking Network Bill is responsible for overall content at WoodworkingNetwork.com Woodworking Network magazine, and related newsletters. Bill also manages event programs for Woodworking Network Live conferences at the Woodworking Machinery & Supplies Expo in Toronto and Cabinets & Closets Expo. He developing audience engagement programs using custom digital printing, live lead-generating events, custom websites, and custom digital and print content. Read Bill Esler's woodworking blogs. He can be reached at besler@woodworkingnetwork.com or follow him on Google+.

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