Wholesaler True Value Co. filed for bankruptcy in Delaware on Monday. The company is looking to sell its business to rival Do it Best Corp.
True Value will continue to operate under Chapter 11 protection. Do it Best has put in a stalking horse bid, meaning other offers can still come in. The initial bid is $153 million in cash, according to the filing.
"After a thorough evaluation, we found selling was the best way forward to maximize value and support our retail partners," said True Value CEO Chris Kempa.
The company has been facing serious liquidity challenges. Back in May, they brought in Houlihan Lokey Inc. to help review their financial options. True Value is among many retailers impacted by inflation, especially those selling discretionary goods like home improvement items.
True Value plans to use its cash to keep the business running during the sale process. Do it Best has also committed to providing additional financial support. True Value currently works with 4,500 independently owned and operated retailers.
The company reported liabilities between $500 million and $1 billion. Its assets are estimated between $100 million and $500 million. Private equity firm Acon Investments purchased a stake in True Value back in 2018.
The bankruptcy case is filed under True Value Company LLC, case number 24-12337, in the US Bankruptcy Court in Delaware.