hhgregg, the appliance and furniture store whose name we have capitalized correctly, needs someone to save it. Very soon. The company needs to find a buyer this week, or it will begin its going out of business sales on Saturday, April 8.
You might remember that when the retailer first filed for bankruptcy protection a month ago, it already had a buyer lined up. The Chapter 11 reorganization looked pretty straightforward: the new buyer would take over the business, and the chain would keep going as a pared-down version of itself. Instead, like many other retailers, hhgregg may rush into a liquidation from Chapter 11.
That buyer withdrew after hhgregg’s vendors objected to the terms of the sale, which required that $6 million of the $8 million set aside to pay “critical vendors” would go to the chain’s advertising agency instead of, say, the vendors that supply it with appliances. This led the Indianapolis Business Journal to speculate that the prospective buyer must be affiliated with the advertising agency.
After the mystery buyer withdrew, company representatives said that there were other bidders considering a deal. The Indianapolis Star reports that any interested buyer only has until Friday to step up, or they’ll have to buy the hhgregg brand after liquidation and bring it back as a zombie brand. The retailer filed a notice with the Securities and Exchange Commission that it has hired liquidators just in case they’re needed, and that the company needs a buyer by Friday, or going out of business sales kick off on Saturday.
The liquidators that have stepped up to do the job are Tiger Capital and Great American Group. The retail liquidation business is only so big, but it’s interesting that those are two of the companies that helped empty out Circuit City stores, some of which hhgregg took over during its expansion.