HIGH POINT – Heritage Home Group LLC and its affiliates are selling off the company's Broyhill, Thomasville & Co. and Luxury Group business units as the residential furniture giant files Chapter 11 bankruptcy.
The company is ranked #4 on the latest FDMC 300 list of the largest North American residential furniture manufacturers, with estimated sales of more than $750 million in 2016.
HHG announced July 30 that parent company, HH Global II BV and its related U.S. affiliates have 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. HHG said it has identified buyers for its brands.
Century Furniture parent company, RHF Investments Inc. has signed an agreement to a acquire HHG’s Luxury business, which includes the
Hickory Chair, Maitland-Smith and Pearson brands and related operations in Hickory, North Carolina, and throughout the United States. According to a statement from HHG, "this transaction provides an opportunity for the Luxury business to join a well-established and successful strategic player in the high-end furniture industry and will enable continued growth in its core interior design and retail selling channels."
RHF also owns Hancock & Moore and Highland House.
A look at Heritage Home Group's finances through its bankruptcy filings, plus information on the sale of HHG's Luxury business unit, which includes the Hickory Chair, Maitland-Smith and Pearson brands.
HHG said it has also signed a letter of intent and is in final negotiations with a buyer for its Thomasville & Co. and Broyhill business units. "We expect to be able to provide more information on this transaction over the next few days." The Thomasville group includes the Thomasville Furniture, Henredon and Drexel brands, which are sold through corporately owned Thomasville stores and independent retailers.
To maximize the value of its assets for shareholders, an auction is also expected to be held within the next 60 days. HHG said it "intends to secure the next chapter of its brands’ long histories by identifying owners that will demonstrate the highest-and-best value for the assets along with the ability to invest in and support their growth." The company added it will file a bid procedures motion to establish a process for soliciting competing bids, subject to court approval.
“Heritage Home Group has a number of iconic brands with strong reputations, solid manufacturing operations and longstanding relationships with best-in-class suppliers, renowned designers, and leading retailers around the world. We are excited to have identified buyers for all of HHG’s brands and secured fresh liquidity to run this sale process, which will deliver the highest-and-best value for our stakeholders," said Robert Albergotti, HHG’s interim chief financial officer and a managing director at AlixPartners, LLP. Albergotti has been named chief restructuring officer for overseeing the process.
HHG has also obtained a commitment from PNC, N.A. to provide a $98 million debtor-in-possession financing facility, including up to $18 million additional liquidity to support the company’s operations during the restructuring and sales process. HHG said it does not anticipate any changes in operations through the commencement of the sale process.
"During this time, we remain firmly committed to producing and selling the high-quality products that our customers expect. I want to thank the talented HHG employees, designers, representatives and distributors for their support and continued dedication,” Albergotti said.
HHG began divesting businesses last year. In December the company sold certain Lane Venture operating assets to Basset Furniture Industries. A month earlier, November 2017, HHG announced the sale of its Lane business to United Furniture Industries.
HHG emerged in the forefront of the residential furniture industry in November 2013 following the purchase by KPS of the bankrupt Furniture Brands International. In 2015 the home furnishings giant moved its headquarters from St. Louis, Missouri, to High Point, North Carolina.
Have something to say? Share your thoughts with us in the comments below.