At Home files bankruptcy, with lenders set to take over
At Home Group Inc. filed bankruptcy to implement a restructuring deal which will see its lenders including Redwood Capital Management LLC, Farallon Capital Management LLC and Anchorage Capital Advisors LP take over the business.
The retailer has reached an agreement with creditors holding more than 95% of its debt that envisages the write-off of most of their $2 billion exposure and the provision of $200 million of new capital, according to a statement on Monday. The company filed for Chapter 11 in Delaware to push through the transaction.
According to a story in USA Today, At Home will close 26 stores by September 2025. In Illinois, the stores that will close are in Crestwood and Peoria.
The move by At Home suggests that the effects of President Donald Trump’s shifting tariff policies are starting to reach retailers.
“We are operating against the backdrop of an increasingly dynamic and rapidly evolving trade environment as we navigate the impact of tariffs,” chief executive officer Brad Weston said in Monday’s statement. “The steps we are taking today to fully de-lever our balance sheet will improve our ability to compete in the marketplace in the face of continued volatility and increase the resilience of our business for the long term.”
The chain has more than 250 stores in the US that sell everything from patio furniture to picture frames and washable rugs. Even before the latest round of import duties came into effect, the company had blamed tariffs for threatening a supply chain that provides its typical store with around 45,000 items, the company said in a regulatory filing.
In response to those challenges, At Home had been shifting some of its manufacturing and product supply lines away from China. Managers told investors last year that it’s shipping products from Vietnam, India and Turkey and expanding sourcing from other countries, including the US.
April’s tariff announcement sent retailers - an industry already under pressure as consumer tastes shift - into a further tailspin. The new policies drove massive losses for the sector in both the equity and credit markets, given that the levies were imposed not only on Asian countries who manufacture the bulk of consumer products, but across the globe.
At Home’s debt has been trading at distressed levels as it struggles to grow revenue.
As part of the Chapter 11 process, the company has an agreement with existing lenders for $600 million of debtor-in-possession financing, which include the new $200 million facility and the roll-up of $400 million of existing debt, the statement said. The lenders have also allowed for the company to use cash collateral during the proceedings.
Private equity firm Hellman & Friedman took At Home private in 2021 in a $2.8 billion deal that has left the company with about $2.4 billion in debt, according to data on the Bloomberg terminal.