LL Flooring, formerly known as Lumber Liquidators, has filed for Chapter 11 bankruptcy and announced the closure of 94 stores across more than 30 states, including Texas. According to filings made in Delaware bankruptcy court on Sunday, the company is grappling with nearly $110 million in long-term debt.
Challenging Market Conditions
The Richmond, Virginia-based company cited slowing home sales and rising interest rates as key contributors to slower sales in the home improvement market. Despite this, LL Flooring’s remaining 300 stores will continue to operate as usual.
Impact on Gift Cards
As part of the bankruptcy process, LL Flooring will stop accepting gift cards at all locations, including those that will remain open, starting September 4. The company noted that gift cards cannot be exchanged for cash, and approximately $131 million in outstanding gift cards are currently owed to customers.
Seeking a Buyer
LL Flooring revealed that it has attempted to find a buyer but is willing to solicit offers to close more stores if a suitable buyer cannot be found. The company stated that it is engaged in discussions with potential buyers and will evaluate binding bids through a court-supervised process to maximize value for all stakeholders.
Financing and Next Steps
LL Flooring has secured $130 million in Chapter 11 financing, funded through existing lenders led by Bank of America. The company anticipates closing a sale of the business by the end of September if a buyer is identified.
