Popular home furnishing retail giant At Home Group Inc. is about to initiate a bankruptcy filing process. A cash crunch, exacerbated by ongoing U.S. tariff challenges, has compelled the company to consider this step. The Hellman & Friedman-owned home décor retailer is expected to file for Chapter 11 bankruptcy in the coming weeks.
Highlights
- Home décor retail chain At Home is planning to apply for Chapter 11 bankruptcy.
- The 46-year-old retailer currently has approximately $17.3 million available under its asset-based lending facility.
- At Home failed to pay due interest in May and is thinking of shifting the supply chain.
At Home To File for Bankruptcy in Coming Weeks
The Texas-based retail chain has been offering home décor services for the last 46 years. At Home, operating over 260 outlets across 40 U.S. states, has been grappling with a financial crisis. Tariffs and changed trade policies have augmented the chain’s troubles.
All of these issues have collectively compelled At Home to prepare for a Chapter 11 bankruptcy filing in the coming weeks.
Interest Payment Challenges Faced by the Longtime Retailer
At Home has been struggling with liquidity challenges for months. Currently, the home furnishing retailer has about $17.3 million under its asset-based facility.
According to the Wall Street Journal, the retailer has been contemplating restructuring debt worth $2 billion since the beginning of this year. It thought of a debt-restructuring plan in April by potentially transferring its ownership to creditors.
The home décor retailer’s financial setback became prominent recently when it missed paying due interest on May 15. Subsequently, on May 23, At Home entered into a forbearance agreement with its lenders.
It should be noted that this agreement will offer the retail giant temporary relief from creditors till June 30.
Strategic Plans to Shift Supply Chain
As of now, the Texas-based retailer sources most of its products from overseas. Given its current financial turmoil, continuing with the same would make At Home further vulnerable to increased costs.
Consequently, the retailer initiated efforts in late 2024 to shift its supply chain and manufacturing away from China. Additionally, the company has been engaging with suppliers in other countries, including India, to diversify its sourcing.
What Lies Ahead for At Home?
Filing for Chapter 11 bankruptcy would allow At Home to reorganize its debts and operations under court supervision. The popular home furnishing retail chain could devise a concrete plan to repay creditors within deadlines. The company might consider liquidating its portfolio of over 260 U.S. stores. Alternatively, the brand could opt to sell only some of its outlets and repay creditors before June 30.
