HIGH POINT - Heritage Home Group announced it has signed an agreement to sell its Broyhill and Thomasville & Co. business groups to a newly formed entity of Authentic Brands Group and SB360 Capital Partners LLC.
Identified as the stalking horse bidder, the ABG/SB360 entity has entered a baseline bid of $22 million for the furniture brands, which also include the Drexel and Henredon brands, and related intellectual property assets. The court-supervised auction is expected to take place within the next 60 days.
The baseline bid of $22 million is subject to higher and better offers in the upcoming auction, HHG said. The company added it is continuing discussions with multiple interested parties, including strategic buyers, for both its Broyhill and Thomasville & Co. business units, and plans to announce the winning bidders once the auction is completed.
“This agreement with the Stalking Horse Bidder for the Broyhill, Thomasville, Drexel and Henredon brands is a clear sign of the value of these beloved names in the furniture industry,” said Chief Restructuring Officer Robert Albergotti. “We have received further interest in the brands and these business units and look forward to continuing these discussions in the period leading up to the auction.
"HHG continues to focus on servicing our customers throughout this process, and we remain grateful for the support of our employees, customers and all other stakeholders.”
Earlier this week HHG filed a WARN Act notice in North Carolina affecting 712 employees at its Lenoir Upholstery and Lenoir Case facilities when an initial attempt to identify a buyer and sell the Broyhill and Thomasville & Co. business groups fell through. In the interim between the Aug. 28 announcement and today's announcement, a new stalking horse bidder was identified as a newly formed entity ABG and SB360. Authentic Brands Group is a brand development, marketing, and entertainment company, which owns a global portfolio of entertainment and lifestyle brands. SB360 Capital Partners is a consulting, business evaluation, asset acquisition, and asset disposition firms.
This agreement relates only to the Thomasville & Co. and Broyhill brands, and does not affect the previously announced agreement for HHG's Luxury Group business unit by an affiliate of RHF Investments. The Luxury Group includes the Hickory Chair, Maitland-Smith and Pearson brands and related operations. In addition to the newly formed entity Hickory Chair LLC, RHF is the parent company of Century Furniture, Hancock & Moore and Highland House.
It was on July 30 that HHG announced parent company, HH Global II BV, and the related U.S. affiliates had filed petitions in U.S. Bankruptcy Court for the District of Delaware to begin the restructuring process and allow for the completion of the sales. The Chapter 11 filing by HHG showed estimated assets and liabilities in the range of $100 million to $500 million.
HHG became a giant in the residential furniture industry in November 2013 following the purchase by KPS of the bankrupt Furniture Brands International. The company began selling off its brands last year, beginning with Lane business to United Furniture Industries in November. HHG followed that up in December with the sale of certain Lane Venture operating assets to Basset Furniture Industries.
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