Dive Brief:
- At Home Group has wrapped up its restructuring and is out of Chapter 11, the home goods retailer said last week.
- Now owned by a group of its lenders, the retailer said it has eliminated nearly all of its $2 billion in funded debt and secured $500 million in new exit financing.
- The company cited tariffs and consumer uncertainty when it filed for bankruptcy in June. At Home now runs 229 stores in 39 states, out of 260 at the time of its filing.
Dive Insight:
At Home now has half of $1 billion to support its post-Chapter 11 turnaround, but it can’t escape the forces that helped send it to bankruptcy court. Namely, that tariffs affect the vast majority of its merchandise, and consumers remain uneasy about discretionary spending.
Moreover, the retailer is highly dependent on seasonal business, which is nearly upon it. In its latest fiscal year, At Home derived 40% of its net sales from holiday and seasonal decor and accessories.
Still, the retailer begins its next chapter with a major debt load gone. In a statement last week, CEO Brad Weston called it “an exciting new beginning.”
“We are officially starting our next phase with renewed financial strength, flexibility and momentum,” he said. “We’re taking decisive actions to become more relevant, more inspiring and more connected to our customers. This new chapter redefines what At Home can be — a brand that helps customers design and create spaces that reflect who they are and how they live.”
The retailer’s new owners include funds affiliated with Redwood Capital Management, Farallon Capital Management and Anchorage Capital Advisors, and there have been resulting shifts to its board of directors. Weston and Redwood Capital Management representative Andrew Kilbourne have already been appointed to the board, and the company expects John Eck and Karen Stuckey to soon be appointed.
Eck most recently was Mattress Firm’s CEO, stepping down ahead of its sale to Somnigroup earlier this year. Stuckey spent nearly two decades at Walmart and serves on Gildan’s board.
