Sofa Express asset auction set for Dec. 19
Deadline for bids is Dec. 17
Clint Engel -- Furniture Today, December 13, 2007
GROVEPORT, Ohio — Sofa Express and More plans to auction off its assets Dec. 19, and the U.S. Bankruptcy Court in Nashville, Tenn., has set a Dec. 21 hearing to consider the sale.
Sofa Express received court approval of an expedited hearing to OK the sale, but it does not yet have a stalking horse agreement with a potential buyer. The auction is set for noon Dec. 19 at the offices of Boult Cummings Conners & Berry in Nashville.
In a press release, Sofa Express CEO Woolard Harris said the retailer was reaching out to liquidators and real estate companies to solicit bids, which are due Dec. 17.
“We believe that it is in the best interest of all of our creditors that we move to an immediate sale of all assets, as a quick sale will garner the most value,” Harris said. He said that “significant delays could impact recovery values.”
According to court documents, Sofa Express has a debt-in-possession financing agreement that requires the retailer have a liquidator approved and in place by Dec. 21.
Sofa Express filed for Chapter 11 bankruptcy protection Dec. 6 in the Middle District of Tennessee, owing its 20 largest industry creditors about $19.4 million. Klaussner, which owns the retailer, is the largest unsecured creditor, owed nearly $18.1 million.
The retailer’s proposed DIP financing is tied to inventory levels, which have been dropping since early November.
“As a result, the debtor’s availability under its financing facility will continue to deteriorate,” a court document said. “Additionally, the debtor has faced a continued decline in employee morale given its current financial situation” and doesn’t believe it will be able to keep the needed employees past this month.
Assets on the block include real estate leases, delivery trucks and trailers, store and distribution center fixtures, and equipment and inventory.
According to court documents, Sofa Express received signed confidentiality agreements with liquidators Gordon Bros. Group, Great American Group and Planned Furniture Promotions before its filing.
It also said it has been in contact with Sun Capital Partners, Hilco and Julius M. Feinblum Real Estate to determine interest. And through a financial advisor hired last month, it also contacted SB Capital Group, American Recovery Group, Hudson Capital Partners, Tiger Capital Group, Nassi Group, RCS Real Estate Advisors and Keen Realty/KPMG.
Business Editor Larry Thomas contributed to this story.
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Sofa Express auction set
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