Berkline files for bankruptcy protection
Berkline logo.JPG
Berkline files for bankruptcy protectionGREENVILLE, TN

- Berkline/BenchCraft Holdings, LLC  has filed a petition for voluntary bankruptcy protection, known as Chapter 11, with the U.S. Bankruptcy Court in Delaware. Listed along with Berkline as joint filers are affiliate companies BenchCraft International Sourcing and Blue Mountain Trucking Corporation.

The creditors list provides a revealing portrait of ongoing operations at Berkline, which specialized in home theater seating with embedded speakers and illuminated drink holders and floor lighting. After attempting to sell its operations, Berkline ran aground at the end of March when it announced it would close, sending its 540 employees scrambling. Outsourced  manufacture, foam and leather, as well as shipping and printing, are among the leading ingredients delivered to Berkline by its unsecured trade creditors.

In Berkline's May 2 bankruptcy filing documents obtained by Woodworking Network, the top three creditors listed include three furniture firms: Zhejiang Ausen Industry Co., Haining, China, owed $4.27 million; Haining Mengnu Group, Hainingcity, China, owed $3.89 million; and Ciar Spa, Pesaro, Italy, owed $782,000.

Also included are Wal-Mart Stores, owed $492,000; Leggett & Platt, owed $302,000 in the U.S. and $275,000 in Jizngyan City, China; and Blue Cross of Alabama, owed $266,000. More than 20 trade creditors are owed $200,000 or more.

The furniture manufacturers end of March it would close down operations, spawning three class action lawsuits from among the 540 employees who were terminated without warning.

Listed among secured equity holders in the 46-page filing document are Sun Capital, which holds a 91.56% stake; as well as Highland Capital (0.74%); Goldman Sachs (4.27%); Golub Capital (1.55%); and Blackrock's State Street Corp. (1.21%). And has a $140MM, second-lien loan that is mostly owed to its parent, SCSF Furniture LLC and other related companies, according to court records.

Bloomberg BusinessWeek says Berkline equity partners hold a $144 million second lien, and that Hilco merhcant Resources has been retained to auction assets.

Berkline was founded in 1928 in Springfield, MA, and relocated to Morristown, TN in 1937. Editor at Large Rich Christianson recapped some of the low points of Berkline's travails, including seizure of furniture inventory after shippers filed suit.



BERKLINE TOP 30 CREDITORS
Zhejiang Ausen Industry Co
.
$4,269,717.00

Haining Mengnu Group Co., Ltd $3,885,254.00
Ciar Spa. $782,198.00
Xiamen Comfort Science  .$653,816.00
Wal-Mart Stores Inc .$492,117.00
Foamex $482,837.00
Foamworks, Inc. $432,974.00
Showplace. $345,879.00
Leggett & Platt Inc $302,175.00 Lakeway Container $300,993.00 Carroll Companies Inc. (Carroll Leather) $275,474.00
Leggett & Platt (Taizhou) Co. Ltd. $274,675.00
Ausen Enterprises (Shanghai) .$270,179.00
Blue Cross Blue Shield of Alabama. .$265,544.00
Haining Kareno Furniture Co., Ltd. $256,688.00
Culp Inc $253,098.00
Taizhou Chenguang Vehicle $252,826.00
Zirkland & Ellis LLP $239,535.00
Penske Truck Leasing Co., L.P .$253,786.00
Zhejiang Ausen Industry Co. Ltd.$216,200.00
Morgan Fabrics .$215,406.00 Evergreen Shipping Agency $209,942.00
Whitesell Corporation-MS $203,262.00
JTM Enterprises. $199,516.00 Bluelinx Corp. .$195,728.00
Topocean Consolidation $186,490.00
Hanes Converting Co $180,198.00
Hayter Printing & Die Cutting $172,243.00
Haining Kasen Leather Co., Ltd. $147,027.00
Raffel Systems $144,842.00
.

Have something to say? Share your thoughts with us in the comments below.