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 woodworkingnetwork.com

Bill Esler

Bill Esler, Associate Publisher/ Editor in Chief, Woodworking Network Bill is responsible for editing Custom Woodworking Business and coordinating content for Wood Products , CLOSETS , WoodworkingNetwork.com, and related newsletters. Bill’s expertise includes using innovative print manufacturing techniques to grow audience engagement, digital printing, purls, QR codes; and lead-generating webcasts, 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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