Court OKs GOB sales at American Home furniture stores
Company will close eight stores
Clint Engel -- Furniture Today, November 17, 2008
LOS ANGELES — U.S. Bankruptcy Court here as approved plans to liquidate American Home's six remaining Arizona stores as part of the Top 100 company's reorganization under Chapter 11 bankruptcy protection.
Planned Furniture Promotions will conduct the sales at the retailer's three stores in Tucson and one each in Prescott, Mesa and Sahuarita. Two stores in New Mexico will also be closed by the Albuquerque, N.M.-based chain, which plans to keep open stores in Albuquerque, Farmington and Santa Fe, N.M.
An attorney for PFP said earlier this month that the liquidator will pay 75 cents on the dollar for the inventory in the Arizona stores and an additional $250,000 as an augment fee to bring in additional goods. Also, $350,000 is to be set aside to fulfill existing customer orders for goods not in stock.
American Home's filing offered more evidence of the credit crunch bearing down on this and other industries. In a court filing, Kenton Van Harten, president and CEO of American Home parent AFC Acquisition Corp., said Wells Fargo Retail Financing had terminated the retailer's credit facility, creating a liquidity crisis that prevented the company from funding operations.
He also attributed American Home's financial difficulties to the weak economy and sales declines.
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