In news that will come as a surprise to exactly nobody in the retail business reports are circulating hot and heavy from usually reliable sources like Bloomberg and the Wall Street Journal that the specialty chain At Home is about to file bankruptcy.
Neither the company nor its private equity owner Hellman & Friedman would comment about any of this but “people familiar with the situation” are cited as saying At Home’s filing is very possible. There may be other solutions but with its debt trading at 38 cents on the dollar according to Bloomberg it doesn’t look good. The Bloomberg report also suggested that the current tariff turmoil might be to blame for any possible bankruptcy and while it no doubt could be a factor, it’s far from the main ones.
Ever since the company went private in 2021 with its purchase by Hellman & Friedman, its finances have been a black hole with neither its vendors nor those interested in its business able to see what was going on. That didn’t stop speculation from being rampant throughout the home furnishings industry. if you asked a vendor who supplied them which retailer they were most concerned with, almost every one of them would point to At Home. Even as the retailer appeared to be paying its bills and reordering as well as anybody in the past few years of the home slowdown, vendors said they were keeping them on a short leash for accounts receivables and trying not to panic.
No doubt these new reports are reigniting that panic and as is often the case in the retail business when rumors start circulating about a company’s pending demise if becomes a self-fulfilling prophecy as suppliers stop shipping them.
For At Home, a bankruptcy and possible liquidation would as said not be shocking. Its huge stores — sometimes as large as 175,000 square feet although newer locations are considerably smaller — contain equally huge amounts of inventory requiring substantial carrying charges. The stores are often located in sub-par and secondary real estate and while an unscientific measuring device, visits frequently reveal few customers given their vast sizes. Big inventory levels and small customer levels are never a winning combination.
At Home was built on the bones of the former Garden Ridge, which had a similar merchandising positioning based on core categories like rugs, outdoor, soft home and home décor with smaller mixes of furniture, housewares and food. Garden Ridge itself filed for bankruptcy and came out of the proceedings as At Home. It prospered for years, building its store count up to around 250 locations, radiating out from its Texas base throughout the southern tier of the country and inching northwards, eventually operating in 40 states.
After long-time CEO Lee Bird retired, At Home brought in the former Walmart executive Jeff Evans as president in May of 2023 but by sometime in 2024 — it’s not clear when — he was gone, succeeded by Brad Weston, who had run Party City, which itself had ended up filing for bankruptcy and eventually being liquidated.
Press reports have been unclear on the timetable for any possible bankruptcy filing but it appeared that it could happen sooner rather than later. For a home sector that has lost such major retailers as Bed Bath & Beyond, Tuesday Morning and Big Lots over the past several years, this would be another major hit for both vendors and shoppers.
It may not happen and there could be a white knight rescue ready to come out of the shadows…but right now it’s looking pretty bleak for At Home.
WarrensReport 