Home Co. files Ch. 11; to arrange financing
By Clint Engel -- Furniture Today, March 10, 2002
NEW YORK — The Home Co. — Fine Furniture Direct has filed for Chapter 11 bankruptcy protection, saying it intends to reorganize quickly with new financing in place.
Mike McDonough, who joined the three-store, upscale retailer last year and was named president and chief executive officer early this year, said the Dallas-based company began the filing process last week in U.S. Bankruptcy Court for the southern district of New York.
There are no plans to close any stores, McDonough said.
"We secured additional capital, which will be utilized to pay current creditors and, we believe, adequately capitalize the company going forward," he said. The reorganization timetable is expected to be "as quick as four weeks."
McDonough wouldn't detail the financing package or discuss unsecured creditors' claims, saying that the company had just begun the filing process. Court documents were not available late last week.
He did say the company has talked to some of its leading suppliers, and "they are aware of our intentions and are telling us they look forward to working with a more financially secure Home Co."
McDonough would not comment on the conditions that led to the filing.
Dave Carpenter, director of credit for La-Z-Boy Financial Services' Greensboro, N.C. location, said Home had been a good Pennsylvania House dealer. He said Pennsylvania House has no exposure in the case, however, since it was selling the retailer on a secured basis until it stopped shipping, six to eight weeks ago.
Bob Stec, president and CEO of Lexington Home Brands, another supplier, said the manufacturer has been working with The Home Co. "and we are pleased and excited about the new infusion of capital."
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