UPDATE: Rooms To Go likely suitor for 10 RoomStore units in Texas
April 5, 2012-- Furniture Today,
RICHMOND, Va. — Rooms To Go has emerged as the likely suitor to acquire RoomStore's 10 remaining stores in Texas.
Jeff Seaman, CEO of the Seffner, Fla.-based Top 100 company confirmed to Furniture/Today that "it's likely" RoomStore was talking about Rooms To Go's bid earlier this week when the Richmond-based chain announced it had an offer from a single suitor for the eight stores in the greater Dallas market and one each in Waco and Temple, Texas.
He added, however, that as of Thursday afternoon the deal had not been concluded and said that even after the two parties reach an agreement, the U.S. Bankruptcy Court would have to approve of it.
Asked about overlap in the market with existing RTG stores in Dallas, Seaman said there is overlap in some cases, "but I'm not prepared to discuss which ones yet."
According to its website, RTG operates seven main stores in greater Dallas and two outlets. Six of the stores have an attached Rooms To Go Kids & Teens store, and there is one additional Kids & Teens store in the market.
Earlier this week, RoomStore said it would exit Texas entirely as it worked to restructure under Chapter 11 bankruptcy protection. It noted there was an offer for the stores but declined to name the suitor.
"This move comes as a result of a decision to consolidate business in the Mid-Atlantic region with one distribution center in North Carolina," RoomStore said in a release.
In a court document filed last week, the Top 100 company said it wants to close all 10 stores in the state and asked the court to set an auction for April 9 to determine the highest bidder for selling off inventory, furniture, fixtures and equipment in Texas.
But RoomStore President and CEO Steve Giordano told Furniture/Today the offer by an unnamed suitor to buy both the inventory and the leases for a going-concern business supersedes the auction motion.
If the Texas exit is approved, the retailer said it would be left with 28 stores - 11 in Maryland, including a clearance center, 10 in Virginia, five in North Carolina and two in South Carolina.
RoomStore filed for bankruptcy protection Dec. 12 and a month later moved to close 24 underperforming stores and a distribution centers, a move that left the company with 37 full-service RoomStores and a clearance center. The retailer also owns a majority stake in the 83-store Mattress Discounters, which was not included in the bankruptcy proceedings.
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