Bankrupt LL Flooring gets last minute rescue with new owner – but 200 stores are still set to close for good

HOME improvement chain LL Flooring is reversing course after announcing it would shutter all its stores.

The bankrupt retailer managed to secure a new buyer, but LL Flooring will still close hundreds of locations.

Getty

Getty

Formerly known as Lumber Liquidators, the flooring chain filed for Chapter 11 bankruptcy in August and was working to negotiate with buyers to sell the company.

In a statement posted to the company’s website on September 4, LL Flooring announced it was unable to secure an offer and planned to shutter its remaining locations.

However, the flooring company found a last-minute buyer that will allow it to keep some locations open.

On Friday afternoon, LL Flooring signed an agreement with private equity firm F9 Investments to sell the business.

As part of the agreement, the private equity firm will acquire 219 LL Flooring stores, a Virginia distribution center, the company’s intellectual property, and other assets.

The deal is expected to close by the end of September.

LL Flooring president and CEO Charles Tyson spoke out on the new agreement.

“We are pleased to have reached this agreement with F9 Investments for a going-concern sale following significant efforts by our team and advisors to preserve the business and maintain ongoing operations,” Tyson said.

“As we move through the court-supervised process toward the approval and completion of this transaction, we remain committed to continuing to serve our valued customers and working closely with our vendors and partners. I continue to be appreciative of the ongoing focus and efforts of our associates to provide the best experience for our customers.”

Despite securing a new buyer, LL Flooring isn’t safe from its wave of closures and will shutter 211 locations.

One hundred seventeen of the locations had closings recently initiated and 94 of the stores were already in the process of shutting down when LL Flooring filed for bankruptcy in August.

FLOORING FUTURE

F9 Investments is owned by Tom Sullivan, who founded Lumber Liquidators in 1994.

He told The Associated Press that the 219 locations F9 intends to purchase will reopen under the name Lumber Liquidators.

“We’ll be getting back to basics,” Sullivan said.

“Basically, yellow and black is coming back … We know what worked before. It’s not fancy offices in Richmond with 200 people that didn’t know the flooring business.

“It’s great people in our stores that know flooring [and] customers that want a great deal and know Lumber Liquidators is the place to go.”

As the company moves forward, Sullivan shared that LL Flooring plans to reduce its flooring selection, eliminating options that feel repetitive or don’t sell well.

He noted that shoppers will likely see major sales on a lot of the inventory remaining from the chain’s bankruptcy process.

Sullivan added that LL Flooring will work with Cabinets To Go, another brand owned by F9 Investments that he founded, to improve shipping efficiency.

WOOD WOES

When LL Flooring was founded around 30 years ago in Massachusetts , it quickly grew to become one of the largest specialty vendors of hardwood flooring in North America.

The company then hit a rough patch after a 60 Minutes segment on the chain’s products was aired.

The 2015 episode exposed LL Flooring’s suppliers saying they provided the company with laminate flooring containing illegal and dangerously high levels of formaldehyde.

Three years later, LL Flooring agreed to pay $36 million to settle class action lawsuits started by customers who bought the products between 2009 and 2015.

We’ll be getting back to basics. Basically, yellow and black is coming back … We know what worked before. It’s not fancy offices in Richmond with 200 people that didn’t know the flooring business. It’s great people in our stores that know flooring [and] customers that want a great deal and know Lumber Liquidators is the place to go.”

Tom Sullivan Owner of F9 Investments

LL Flooring changed its name from Lumber Liquidators in 2021 following the controversy.

The company has still struggled to make a profit in recent years.

LL Flooring’s net sales dropped 18.5% in 2023 thanks to a decline in foot traffic and demand for its products, per a recent earnings report.

In its bankruptcy filing, the flooring company shared that it had over $416 million in debt as of July 31 and assets of just over $501 million.

The LL Flooring lawsuit and drop in consumer spending on non-essentials after the pandemic have contributed to the chain’s struggles.

The latter factor pushed furniture and electronics chain Conn’s HomePlus to file for bankruptcy and close all its locations.

Plus, Big Lots officially filed for bankruptcy after weeks of rumors and will close 545 locations.