Furniture Brands Announces Court Approval for Stalking Horse Bid
October 3, 2013,
ST. LOUIS-Furniture Brands International today announced that it has entered into an asset purchase agreement with KPS Capital Partners L.P. to acquire substantially all of the company's assets for $280 million, including the company's Lane business.
In addition, Furniture Brands has filed a motion seeking authorization from the U.S. Bankruptcy Court for the District of Delaware to conduct an auction process for the company. KPS would serve as the "stalking horse" bidder in the proposed auction, establishing a minimum value of the company's assets.
The court entered an interim order under which KPS will replace Oaktree Capital Management L.P. as the DIP lender to ensure its operations will continue uninterrupted and to set a final hearing for Oct. 11. KPS has committed to fund up to approximately $190 million as the DIP lender.
In order to maximize the asset price of the company's brands, the acquisition agreement would allow for additional qualified prospective bidders to enter an auction process with KPS. The court authorized the company to proceed with an auction of the company's assets on or before Dec. 10, subject to the approved bidding procedures, and set Dec. 5 as the deadline for any bids.