Latest news with #AtHomeGroup
Yahoo
18-07-2025
- Business
- Yahoo
Blame it on tariffs: CEOs roll out new excuse for bankruptcies
(Bloomberg) — When At Home Group Inc.'s lawyer stood before a US bankruptcy judge last month asking to wipe out nearly $2 billion of the retailer's debt, the reason came quick: tariffs. It's a line that's showing up in more and more courtrooms. Tile importer Mosaic Cos. blamed them in a recent filing. Just weeks earlier, it was auto-parts supplier Marelli Holdings Co. and aluminum trader Sinobec Group Inc. In all, tariffs have been laid out as a key reason in at least 10 bankruptcies in the US since early April, when President Donald Trump first unveiled a new wave of levies, according to data compiled by Bloomberg. But to many economists and analysts, the tariff blame game doesn't hold up — at least not yet. For one, it's simply too early for the latest duties to have made a material impact on corporate performance, especially for companies that typically carry several months' worth of inventory, they say. What's more, recent data showing solid employment growth, rising wages and a persistently low jobless rate signal that the economy is still holding up. It's the latest chapter in a well-worn corporate bankruptcy playbook, where companies pin their collapse on everything from fickle consumers to currency swings — even bad weather — anything but their own missteps. While market watchers say tariffs could eventually push a number of struggling firms over the edge, right now they're seen more as an excuse to paint over deeper problems. 'Companies are struggling, but the tariffs did not put them into bankruptcy,' said Stephanie Roth, chief economist at Wolfe Research. 'Until the labor market starts to crack in a real negative way, there's no great reason to believe that consumers should pull back or that the economy is weakening sufficiently.' Take At Home, which sells everything from patio furniture to rugs to generic wall decor. Its woes began well before Trump's latest round of tariffs. Burdened with a high debt load following its 2021 takeover by private equity firm Hellman & Friedman, the impact of the Covid-19 pandemic on supply chains led to rising costs for material and labor. As consumers shifted to spending more on travel and leisure, waning demand for home goods also dented performance, leading to credit-rating downgrades and a distressed exchange in 2023. Last month, the Texas-based company said it will close at least 26 of its more than 250 stores as part of its bankruptcy. At its Rego Park location in Queens, New York — one that it plans to shutter — customers who braved the summer heat in search of bargains were lamenting its demise. 'I am a little sad to see this one go because it's just so much easier to get something that fits your style,' said Diana Delacruz, 22, who was browsing items at the store's going-out-of-business sale. A representative for At Home declined to comment. Marelli, the auto-parts supplier, for its part, said in a court filing that it was 'severely affected' by headwinds driven by auto tariffs rolled out by the Trump administration in March. But the company, which provides lighting systems and suspensions to the likes of Stellantis NV and Nissan Motor Co., was already contending with industry upheaval as electrification and automation forced carmakers to shift their strategy to cope with declining sales in key markets. 'The market pressures impacting the entire automotive industry and lower production volumes we began seeing a year ago, long before current tariffs were put in place, were the main issues that constrained our working capital,' Fernando Vivanco, Marelli's chief communications officer, said in an emailed response to questions. Sunnova Struggles Some companies have said that tariffs are just one of a number reasons they've struggled. In its June filing, Sunnova Energy International Inc. said cuts to government subsidies, inflation and higher interest rates were curbing demand for their equipment — while mentioning that the latest tariffs were another hurdle. Prominent names in the sector including SunPower Corp., Lumio, and Meyer Burger Technology AG's US operations have also filed for bankruptcy over the past year. A representative for Sunnova declined to comment beyond the bankruptcy filing. Market watchers say that depending on how current Trump administration negotiations play out, tariffs could ultimately play a much larger role in bankruptcies in the months ahead. Recent economic indicators — consumer spending, retail sales, US factory activity — already show a dent in demand amid the policy uncertainty. The number of companies at the greatest risk of defaulting are at an 11-month high, Moody's Ratings said in a report earlier this week So far, however, the overall damage to companies has been contained. S&P Global Ratings said earlier this month that only 31 credit grade cuts in recent months have been tied to tariffs, less than 1% of its total ratings actions. For now, some say that if plans for a restructuring were already in the works, Trump's levies may have just served as motivation to file for bankruptcy sooner. Some of these 'smell of the private capital people who are adept at using the bankruptcy laws to facilitate a restructure of a business that they want to keep but has an unsustainable debt burden,' said Todd Baker, a senior fellow at the Richmond Center for Business, Law, and Public Policy at Columbia University. —With assistance from Steven Church. ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-07-2025
- Business
- Yahoo
Blame It on Tariffs: CEOs Roll Out New Excuse for Bankruptcies
(Bloomberg) -- When At Home Group Inc.'s lawyer stood before a US bankruptcy judge last month asking to wipe out nearly $2 billion of the retailer's debt, the reason came quick: tariffs. The Dutch Intersection Is Coming to Save Your Life Advocates Fear US Agents Are Using 'Wellness Checks' on Children as a Prelude to Arrests Mumbai Facelift Is Inspired by 200-Year-Old New York Blueprint LA Homelessness Drops for Second Year Manhattan, Chicago Murder Rates Drop in 2025, Officials Say It's a line that's showing up in more and more courtrooms. Tile importer Mosaic Cos. blamed them in a recent filing. Just weeks earlier, it was auto-parts supplier Marelli Holdings Co. and aluminum trader Sinobec Group Inc. In all, tariffs have been laid out as a key reason in at least 10 bankruptcies in the US since early April, when President Donald Trump first unveiled a new wave of levies, according to data compiled by Bloomberg. But to many economists and analysts, the tariff blame game doesn't hold up — at least not yet. For one, it's simply too early for the latest duties to have made a material impact on corporate performance, especially for companies that typically carry several months' worth of inventory, they say. What's more, recent data showing solid employment growth, rising wages and a persistently low jobless rate signal that the economy is still holding up. It's the latest chapter in a well-worn corporate bankruptcy playbook, where companies pin their collapse on everything from fickle consumers to currency swings — even bad weather — anything but their own missteps. While market watchers say tariffs could eventually push a number of struggling firms over the edge, right now they're seen more as an excuse to paint over deeper problems. 'Companies are struggling, but the tariffs did not put them into bankruptcy,' said Stephanie Roth, chief economist at Wolfe Research. 'Until the labor market starts to crack in a real negative way, there's no great reason to believe that consumers should pull back or that the economy is weakening sufficiently.' Take At Home, which sells everything from patio furniture to rugs to generic wall decor. Its woes began well before Trump's latest round of tariffs. Burdened with a high debt load following its 2021 takeover by private equity firm Hellman & Friedman, the impact of the Covid-19 pandemic on supply chains led to rising costs for material and labor. As consumers shifted to spending more on travel and leisure, waning demand for home goods also dented performance, leading to credit-rating downgrades and a distressed exchange in 2023. Last month, the Texas-based company said it will close at least 26 of its more than 250 stores as part of its bankruptcy. At its Rego Park location in Queens, New York — one that it plans to shutter — customers who braved the summer heat in search of bargains were lamenting its demise. 'I am a little sad to see this one go because it's just so much easier to get something that fits your style,' said Diana Delacruz, 22, who was browsing items at the store's going-out-of-business sale. A representative for At Home declined to comment. For more on corporate distress and bankruptcies, subscribe to The Brink Marelli, the auto-parts supplier, for its part, said in a court filing that it was 'severely affected' by headwinds driven by auto tariffs rolled out by the Trump administration in March. But the company, which provides lighting systems and suspensions to the likes of Stellantis NV and Nissan Motor Co., was already contending with industry upheaval as electrification and automation forced carmakers to shift their strategy to cope with declining sales in key markets. 'The market pressures impacting the entire automotive industry and lower production volumes we began seeing a year ago, long before current tariffs were put in place, were the main issues that constrained our working capital,' Fernando Vivanco, Marelli's chief communications officer, said in an emailed response to questions. Sunnova Struggles Some companies have said that tariffs are just one of a number reasons they've struggled. In its June filing, Sunnova Energy International Inc. said cuts to government subsidies, inflation and higher interest rates were curbing demand for their equipment — while mentioning that the latest tariffs were another hurdle. Prominent names in the sector including SunPower Corp., Lumio, and Meyer Burger Technology AG's US operations have also filed for bankruptcy over the past year. A representative for Sunnova declined to comment beyond the bankruptcy filing. Market watchers say that depending on how current Trump administration negotiations play out, tariffs could ultimately play a much larger role in bankruptcies in the months ahead. Recent economic indicators — consumer spending, retail sales, US factory activity — already show a dent in demand amid the policy uncertainty. The number of companies at the greatest risk of defaulting are at an 11-month high, Moody's Ratings said in a report earlier this week So far, however, the overall damage to companies has been contained. S&P Global Ratings said earlier this month that only 31 credit grade cuts in recent months have been tied to tariffs, less than 1% of its total ratings actions. For now, some say that if plans for a restructuring were already in the works, Trump's levies may have just served as motivation to file for bankruptcy sooner. Some of these 'smell of the private capital people who are adept at using the bankruptcy laws to facilitate a restructure of a business that they want to keep but has an unsustainable debt burden,' said Todd Baker, a senior fellow at the Richmond Center for Business, Law, and Public Policy at Columbia University. --With assistance from Steven Church. What the Tough Job Market for New College Grads Says About the Economy How Starbucks' CEO Plans to Tame the Rush-Hour Free-for-All Godzilla Conquered Japan. Now Its Owner Plots a Global Takeover A Rebel Army Is Building a Rare-Earth Empire on China's Border Why Access to Running Water Is a Luxury in Wealthy US Cities ©2025 Bloomberg L.P. Sign in to access your portfolio
Bloomberg
18-07-2025
- Business
- Bloomberg
Blame It on Tariffs: CEOs Roll Out New Excuse for Bankruptcies
When At Home Group Inc. 's lawyer stood before a US bankruptcy judge last month asking to wipe out nearly $2 billion of the retailer's debt, the reason came quick: tariffs. It's a line that's showing up in more and more courtrooms. Tile importer Mosaic Cos. blamed them in a recent filing. Just weeks earlier, it was auto-parts supplier Marelli Holdings Co. and aluminum trader Sinobec Group Inc. In all, tariffs have been laid out as a key reason in at least 10 bankruptcies in the US since early April, when President Donald Trump first unveiled a new wave of levies, according to data compiled by Bloomberg.
Yahoo
17-06-2025
- Business
- Yahoo
Home decor retailer files for Chapter 11 bankruptcy as part of restructuring
At Home Group has filed for bankruptcy to help the home decor retailer undergo a restructuring. The company announced Monday it started Chapter 11 bankruptcy proceedings so that it can implement a "restructuring support agreement" that it has signed with lenders "holding more than 95% of the Company's debt." The restructuring support agreement will help the retailer wipe out "substantially all" of its nearly $2 billion in funded debt, At Home said. It will also infuse the retailer with $200 million of capital. Rite Aid Files For Bankruptcy For Second Time In Less Than 2 Years "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," CEO Brad Weston said. At Home has reached a deal for $600 million in debtor-in-possession financing in total. The other $400 million will come from a "roll up" of existing senior secured debt, it said. Read On The Fox Business App The funds, subject to court approval, will help "provide sufficient liquidity to support the business during the court-supervised process," according to At Home. Florida-based Airline Suddenly Shuts Down, Leaving Travelers Stranded While going through Chapter 11 bankruptcy, At Home will sell products at physical stores and through its website, the company said. It plans to keep a "majority" of its home decor stores open during the process, according to a document on its restructuring website. The retailer's footprint currently spans 260 locations scattered across 40 states. Lenders including Redwood Capital Management, Farallon Capital Management and Anchorage Capital Advisors will become At Home's new owners following the completion of the restructuring, according to At Home. "Upon emergence from the rearranged restructuring process, At Home will move forward with new owners and a meaningfully strengthened balance sheet," Weston said. "Importantly, this process will also further equip us with opportunities to invest in our strategic initiatives and to continue fortifying our business for the long term." Weightwatchers Files For Bankruptcy The retailer's restructuring support agreement and bankruptcy filing come after At Home took "deliberate steps" over the past several months to help boost sales growth, manage its inventory better and increase its efficiency in the face of a "dynamic and rapidly evolving trade environment" from tariffs, according to At Home's CEO. In its Chapter 11 petition, it estimated a range of $1 billion to $10 billion for its assets. Its estimated liabilities had the same range. The home decor retailer's origins trace back to the late 1970s. It has been owned by funds affiliated with private equity firm Hellman & Friedman since article source: Home decor retailer files for Chapter 11 bankruptcy as part of restructuring Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
17-06-2025
- Business
- Yahoo
At Home files for bankruptcy with lenders set to take control
US home-decor retailer the At Home Group and certain subsidiaries have filed for voluntary Chapter 11 bankruptcy protection, with plans to facilitate ownership transition to lenders. According to the terms agreed upon in the restructuring support agreement (RSA), a planned financial reorganisation aims to cut the company's existing debt by $2bn. It includes a provision for a $200m capital injection to aid the company during and after the restructuring phase. As per the RSA, ownership of At Home is expected to shift to the participating lenders post-restructure. The lenders, which are set to provide new capital, include entities associated with Redwood Capital Management, Farallon Capital Management, and Anchorage Capital Advisors. They hold more than 95% of the company's debt. The proceedings have commenced in the US Bankruptcy Court for the District of Delaware to execute its restructuring plan. At Home has faced recent financial difficulties which have intensified due to tariffs and trade disputes. The US retailer will continue to operate and offer affordable design and decorating solutions during this court-supervised process. In relation to the Chapter 11 proceedings, At Home is arranging $600m in debtor-in-possession financing, which incorporates the $200m capital boost from some existing lenders and a roll up of $400m of existing senior secured debt. At Home expects the financing, along with revenue from ongoing operations, to provide ample liquidity for the business during the court-supervised process, subject to court approval. The retailer has submitted standard first-day motions to the court to sustain business operations and manage the Chapter 11 cases efficiently. This includes the uninterrupted payment of team member wages and benefits. At Home also intends to fully compensate vendors and suppliers for goods and services provided post-filing. At Home CEO Brad Weston stated: 'Over the past several months, we've taken deliberate steps to strengthen the foundation of our business - sharpening our focus, elevating our customer value proposition and driving operational discipline. These efforts are aimed at delivering sustained sales growth, optimising our inventory management, improving efficiency and enhancing overall profitability. 'While we have made significant progress advancing our initiatives to date, we are operating against the backdrop of an increasingly dynamic and rapidly evolving trade environment as we navigate the impact of tariffs. 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.' Kirkland & Ellis is providing legal counsel, PJT Partners is the financial advisor, AlixPartners is the restructuring advisor and Hilco Real Estate is the real estate consultant for At Home. Strategic communications advice is being offered by Joele Frank and Wilkinson Brimmer Katcher. Dechert is the legal counsel and Evercore Group is the financial advisor for the ad hoc group of lenders. "At Home files for bankruptcy with lenders set to take control" was originally created and published by Retail Insight Network, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
