(Reuters) – Furniture Brands International Inc filed for Chapter 11 bankruptcy protection on Monday and said it plans to sell most of its business, which includes names such as Thomasville, Drexel Heritage and La Barge.
The St. Louis-based company said in a statement it agreed to sell all of its brands except Lane Furniture to Oaktree Capital Management, an investment firm that specializes in buying assets from bankrupt companies.
The sale agreement will be subject to higher bids and a court-supervised auction. The money from the auction will be used to repay Furniture Brands creditors.
The company’s pink sheet stock was down 33 cents or 57 percent at 24 cents per share in afternoon trading.
Oaktree also committed to providing a $140 million debtor-in-possession or DIP loan to finance the bankruptcy case.
The company said in documents filed in Delaware’s U.S. Bankruptcy Court that it estimated its assets were worth $546.7 million and its liabilities were worth $550.1 million.
It said its largest creditors were LP Products PTE Ltd, a trade creditor owed $2.5 million, and the Pension Benefit Guaranty Corp, a government insurer of defined-benefit pensions.
The case is Furniture Brands International Inc, U.S. Bankruptcy Court, District of Delaware, 13-12329.