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Orchard Supply hires Great American to oversee eight store closings
By Jim Witters
Wilmington, Del., June 28 - Orchard Supply Hardware Stores Corp. may hire Great American Group WF, LLC to handle going-out-of-business sales at eight of its under-performing stores beginning on June 29, according to a June 28 ruling in the U.S. Bankruptcy Court for the District of Delaware.
Judge Christopher S. Sontchi approved the move, which allows Great American to take advantage of the increased potential presented by the coming Independence Day weekend.
As previously reported, Lowe's Cos., Inc. has agreed to acquire the majority of the debtor's assets for $205 million in cash, plus the assumption of payables owed to nearly all of Orchard's supplier partners.
The eight underperforming stores scheduled to be closed are not part of that asset purchase agreement.
Great American emerged as the prevailing bidder at a June 27 auction.
A joint venture of Hilco Merchant Resources, LLC and Gordon Brothers Retail Partners, LLC served as the stalking horse bidder, guaranteeing Orchard 72% of the proceeds.
After 16 bids at the auction, Great American's offer of 82.5% prevailed.
Hilco agreed to reduce its $300,000 breakup fee because Great American is buying the signs Hilco planned to use at the sales, Orchard attorney Richard A. Chesley told the court.
The closing sales will run from the date of the court order approving the closing through Sept. 30.
Orchard will have the right to include as many as 22 additional stores to the closing sale until 5 p.m. ET on July 31.
Orchard Supply, a San Jose, Calif.-based hardware retailer, filed for bankruptcy on June 17. Its Chapter 11 case number is 13-11565.
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