Business news from the Fredericksburg region.
RoomStore up for auction June 25
BY BILL FREEHLING
The fate of a Spotsylvania County furniture store will probably be determined at a June 25 auction in Richmond.
RoomStore Inc. is holding an auction starting at 11 a.m. that day at the Hilton Garden Inn at 501 E. Broad St. in Richmond, the city that serves as the company’s headquarters. Many of RoomStore Inc.’s assets—including its furniture, store leases and brand name—will be available to the highest bidder.
“We are in the process of looking for a successful resolution of our Chapter 11 case in the form of a purchase of the assets and/or business,” said Chief Executive Officer Stephen Giordano. “We prefer to sell the assets to a strategic buyer. A strategic buyer may be someone who is in the furniture business as a furniture retailer or furniture supplier.”
He said several parties are performing due diligence in order to potentially submit a proposal to purchase the company. At the same time, RoomStore, as required by an agreement with its creditors, is providing bid packages to various parties who might be interested in bidding on its remaining inventory and other assets.
“Among our goals are to maximize the purchase price of our assets, continue the employment of our employees, facilitate the assumption and assignment of the largest number of store leases and enable creditors to have an ongoing customer,” Giordano said. “As part of this process and in accordance with the company’s legal obligation, we will continue to provide interested parties with due diligence information.”
RoomStore Inc. has 28 stores in Maryland, South Carolina, North Carolina and Virginia, including a 25,000-square-foot leased location at 4040 Plank Road (State Route 3) in Spotsylvania. All of the stores will remain open as normal through the auction date.
The company has about
6 years left on the Spotsylvania lease plus a number of renewal options beyond 2018, said RoomStore Inc. Senior Vice President Brian Bertonneau. A Norfolk-based LLC called Lakewood Properties owns the real estate that RoomStore leases locally, according to Spotsylvania property records. About $19,790 in rent remains unpaid at the Spotsylvania store from before RoomStore Inc. declared Chapter 11 bankruptcy in December.
People will be able to bid for all of the offered assets or just parts of them at the auction. The new owner or owners could then decide to hold closing sales or continue operating the stores under the RoomStore brand or some other name.
People interested in participating in the auction have until June 19 to submit a bid. Only pre-qualified bidders will be allowed to attend the auction.
—Assistant business editor Cathy Jett contributed to this article.
Bill Freehling: 540/374-5405