True Value Company, L.L.C. and its affiliates filed their disclosure statement on January 21, 2025, detailing their proposed Chapter 11 plan of reorganization in the U.S. Bankruptcy Court for the District of Delaware (Case No. 24-12337). The filing outlines the hardware wholesaler's strategy to emerge from bankruptcy following the November 2024 sale of substantially all its assets to Do it Best Corp. for $153 million.
The disclosure statement, filed by the debtors' counsel Skadden, Arps, Slate, Meagher & Flom LLP, explains how the company plans to distribute proceeds from the sale to creditors. The plan proposes to pay secured lenders and establish a litigation trust for the benefit of general unsecured creditors.
True Value, which operated twelve distribution centers serving approximately 5,000 retail storefronts before bankruptcy, cited COVID-19's lasting impact on its business as a primary factor leading to its Chapter 11 filing. The company reported that its revenue dropped 8% year-over-year to $1.455 billion in 2023, followed by a further 14% decline through August 2024.
The plan must receive court approval before being sent to creditors for voting. A combined hearing on the disclosure statement and plan confirmation is scheduled for March 27, 2025. Creditors in Classes 3 (Prepetition Lender Claims) and 4 (General Unsecured Claims) are entitled to vote on the plan, with ballots due by March 14, 2025.
The Official Committee of Unsecured Creditors, represented by Pachulski Stang Ziehl & Jones LLP, includes major suppliers such as STIHL Inc., The Hillman Group, and Black & Decker.
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Document length: 90 pages