True Value: $153M 363 Sale to Do it Best in Chapter 11
True Value Company, L.L.C. filed chapter 11 in the District of Delaware on October 14, 2024 after lender cash sweeps squeezed liquidity. A stalking horse deal to Do it Best Corp. valued at $153 million led to a sale order on November 13, 2024.
True Value Company, L.L.C., a Chicago-based hardware wholesaler, filed for chapter 11 on October 14, 2024 in the U.S. Bankruptcy Court for the District of Delaware and entered the case with a plan to pursue a sale to Do it Best. The company said it had reached a sale agreement for a going-concern transaction, and local reporting described the business as Chicago-based with a long retail history.
Coverage of the filing emphasized the plan to sell the wholesale platform through bankruptcy, including a sale announcement and a later bankruptcy deal that cleared the path for the transaction. Court filings show the plan was confirmed April 17, 2025 and became effective April 25, 2025. The company described itself as a 75-year-old hardware retailer and wholesaler with a national footprint, which framed the case as a liquidity-driven restructuring rather than a store-level liquidation.
| Debtor(s) | True Value Company, L.L.C. (and affiliated debtors) |
| Court | U.S. Bankruptcy Court, District of Delaware |
| Case Number | 24-12337 |
| Judge | Hon. Karen B. Owens |
| Petition Date | October 14, 2024 |
| Confirmation Date | April 17, 2025 |
| Effective Date | April 25, 2025 |
| Employees | ~1,950 |
| Primary Business | Hardware and home improvement wholesaler/distributor |
| Sale Transaction | 363 sale to Do it Best Corp. for $153 million cash plus assumed liabilities |
| Plan Type | Liquidation plan with litigation trust distributions |
| 503(b)(9) Bar Date | November 27, 2024 |
| General Bar Date | December 5, 2024 |
| Governmental Bar Date | April 14, 2025 |
363 sale restructuring and plan path
The chapter 11 strategy centered on a court-supervised 363 sale followed by a liquidation plan. The debtors filed the sale motion on the petition date and sought authority to use cash collateral, framing the case around a going-concern transfer that preserved vendor and retailer relationships. The court entered an interim cash collateral order on October 18, 2024 and a final order on November 4, 2024, providing operating liquidity subject to a weekly budget, variance reporting, and lender protections.
Bid protections and assignment procedures were approved on November 4, 2024, and the sale order was entered November 13, 2024. The transaction contemplated a $153 million cash price and assumed liabilities, including a capped amount of assumed payables. The purchase agreement included a deposit, bid protections, and a good-faith purchaser finding, allowing the buyer to take the assets free and clear of liens, claims, and interests while assuming designated executory contracts.
After the sale order, the debtors pivoted to a plan process. The initial plan and disclosure statement were filed in January 2025, amended in February, and superseded by a third amended plan on March 31, 2025. The plan is a liquidation framework: it allocates remaining value through reserves and a litigation trust and assigns different treatment to secured, priority, and unsecured constituencies. The confirmation order was entered April 17, 2025 and the plan became effective April 25, 2025, at which point a plan administrator took over the wind-down.
Plan treatment overview. The plan classifies claims into secured, priority, unsecured, and equity classes and provides for pro rata distributions from litigation trust recoveries where applicable. Prepetition lender claims and general unsecured claims are impaired, while priority and other secured claims are unimpaired and paid in full in cash or otherwise treated as unimpaired. Intercompany claims and interests are resolved at the debtors' discretion, and subordinated claims and existing equity interests are canceled with no distribution.
| Class | Status | Treatment summary |
|---|---|---|
| Class 1 - Other Priority Claims | Unimpaired | Paid in full in cash after the Effective Date or when allowed |
| Class 2 - Other Secured Claims | Unimpaired | Paid in full in cash, return of collateral, or other unimpaired treatment |
| Class 3 - Prepetition Lender Claims | Impaired | Distributions under plan settlement plus litigation trust interests |
| Class 4 - General Unsecured Claims | Impaired | Pro rata litigation trust GUC interests |
| Class 5 - Intercompany Claims | Debtors' discretion | Reinstated, canceled, or otherwise resolved |
| Class 6 - Intercompany Interests | Debtors' discretion | Reinstated, canceled, or otherwise resolved |
| Class 7 - Subordinated Claims | Impaired | Canceled with no distribution |
| Class 8 - Existing Interests | Impaired | Canceled with no distribution |
Business overview and operating footprint
True Value operates as a hardware retailer and wholesaler whose business model is built around supplying independent hardware stores. Court filings describe a national distribution platform with approximately 75,000 products sourced from more than 2,000 suppliers and delivered to roughly 4,500 retail storefronts. The network includes core, strategic, e-commerce, international, secondary, and specialty accounts, with most sales tied to True Value-branded retailers.
The company reported 12 leased distribution centers and a paint manufacturing plant in Cary, Illinois. As of the petition date, it employed about 1,950 workers, including unionized employees represented by Teamsters locals. Court filings also indicated that member stores are independently owned and not part of the chapter 11 cases, except for one company-owned location in Palatine, Illinois. The filing emphasized that the wholesale platform would continue to serve retailer demand during the sale process, with the goal of maintaining supply continuity for independently owned stores.
Local coverage described True Value as a Chicago-based company with a long operating history, and other reporting called it a hardware chain that would pursue a court-supervised sale. Those reports align with the debtors' characterization of the business as a supply-chain platform rather than a traditional big-box retailer, with stores owned by local operators that rely on True Value for inventory and branded programs.
Drivers of distress and liquidity constraints
Management attributed the filing to a combination of post-pandemic demand normalization, supply chain disruptions, and a tightening of lender controls. Court filings stated that sales fell below pre-pandemic levels after a period of elevated demand and that the company faced cost pressures related to inventory availability and fulfillment. Those conditions fed into a liquidity squeeze at a time when the company relied on asset-based borrowing to fund seasonal working capital needs.
The first day declaration described a shift in lender posture that materially constrained cash availability. The prepetition lenders tightened borrowing base availability and exercised cash dominion, sweeping daily cash receipts and requiring lender consent for disbursements. The combination of lower sales and restricted liquidity reduced working capital and limited operational flexibility, prompting the company to pursue a going-concern sale rather than an extended stand-alone restructuring.
The sale strategy was designed to preserve the wholesale network while monetizing the business for creditors. Management described the transaction as a means to protect retailer relationships, stabilize supplier terms, and avoid a fragmented wind-down. The bankruptcy filing and sale process therefore reflect a restructuring centered on preserving distribution value and transferring it to a buyer positioned to keep the network operating.
Capital structure and cash collateral terms
True Value entered chapter 11 with a secured credit facility that included a term loan and an asset-based revolving facility. The facility was secured by substantially all assets, and PNC Bank served as administrative agent. The debtors also had letter of credit exposure and a secured commercial card program. The debt stack and collateral package shaped the restructuring, which relied on cash collateral rather than new DIP financing.
| Obligation | Amount | Notes |
|---|---|---|
| Secured credit facility | Approx. $238.2 million funded | Includes term loan and ABL revolver secured by substantially all assets |
| Term loan | $18.75 million outstanding | Part of prepetition credit facility |
| ABL revolver | Up to $300 million (borrowing base) | Commitments reduced to $300 million in September 2024 |
| Letters of credit | $11.31 million outstanding | Issued under the credit facility |
| PNC commercial card program | Up to $25 million | Secured by first-priority lien on collateral |
The interim cash collateral order approved an eight-week budget with weekly variance reporting and provided a carve-out for statutory fees and professional fees. Adequate protection included replacement liens and superpriority claims to the extent of diminution in value. The final cash collateral order approved a negotiated term sheet that included reporting covenants and a condition tied to the asset purchase agreement, under which the buyer agreed to provide up to an additional $10 million to ensure lender recoveries reached a specified threshold.
The cash collateral structure influenced the pace of the sale process and the plan timeline. Interest payments accrued at non-default rates, and the debtors' operating budgets were tied to a court-approved framework that required periodic reporting. The lender protections in the cash collateral orders also shaped plan negotiations, including the settlement structure embedded in the third amended plan for prepetition lender claims.
363 sale to Do it Best and transfer mechanics
The sale process was structured around a stalking horse agreement with Do it Best Corp., a competitor in the hardware distribution market. The debtors described the transaction as a going-concern transfer intended to preserve the wholesale platform and protect retailer supply chains. The company publicly announced a sale agreement with a purchase price of $153 million, and coverage of the filing highlighted the plan to sell the business to a rival through chapter 11.
Local reporting noted that the sale needed to generate at least about $163 million to satisfy prepetition lender recovery thresholds, and the sale order incorporated a condition under which the buyer would contribute additional funds to meet that benchmark. A later bankruptcy deal cleared the path for the transaction, and press coverage described the sale as a transfer to a rival operator.
The sale agreement contemplated a cash purchase price, assumed liabilities, and a cap on assumed payables. The stalking horse bidder posted a deposit that was applied to the purchase price at closing. Bid protections included a break-up fee and expense reimbursement, and the sale order found the buyer to be a good-faith purchaser under section 363(m). The order authorized transfer of substantially all assets free and clear of liens, claims, and interests, subject to a cure process for assumed executory contracts and unexpired leases.
| Sale Term | Detail |
|---|---|
| Buyer | Do it Best Corp. |
| Purchase price | $153 million cash plus assumed liabilities |
| Assumed payables | Capped at $45 million |
| Deposit | $15.3 million applied to purchase price at closing |
| Bid protections | Break-up fee and expense reimbursement as superpriority administrative expense |
| Sale order | Entered November 13, 2024; good-faith purchaser finding |
The structure allowed the debtors to complete the sale while leaving behind legacy liabilities and claims for resolution under the plan. Contract assumption and assignment procedures were embedded in the bid protections order and sale order, and the plan later addressed the distribution of remaining value after the sale closed. The transaction therefore functioned as the core value event in the case, with the plan focused on monetizing post-sale recoveries and managing claims reconciliation.
Confirmation, bar dates, and post-effective administration
The confirmation order was entered April 17, 2025, and the plan went effective April 25, 2025. The Notice of Effective Date also set post-confirmation deadlines for administrative claims and professional fees, and it established a post-confirmation rejection damages bar date. Following effectiveness, the plan administrator assumed responsibility for claim reconciliation, litigation trust administration, and plan implementation.
Michael I. Goldberg was named as the plan administrator. The plan administrator's role includes overseeing distributions, administering reserves, and pursuing litigation trust recoveries for the benefit of creditor constituencies. Court filings after confirmation show the plan administrator continuing to handle claim objections and claim reconciliation under the confirmed plan framework.
Bar date procedures were established early in the case. The bar date order set a separate deadline for section 503(b)(9) claims, a general bar date for non-governmental prepetition claims, and a governmental bar date for public entities. The order also set an amended schedules bar date and a rejection damages bar date tied to the timing of rejection orders. The claims agent managed notice and receipt of claims.
| Bar Date | Deadline | Notes |
|---|---|---|
| 503(b)(9) Bar Date | November 27, 2024 at 11:59 p.m. ET | Claims for goods received in the 20 days prepetition required invoice-level documentation |
| General Bar Date | December 5, 2024 at 11:59 p.m. ET | Applies to non-governmental prepetition claims |
| Governmental Bar Date | April 14, 2025 at 11:59 p.m. ET | Applies to governmental units and tax claims |
| Administrative Claims Bar Date | May 25, 2025 | Post-confirmation administrative claims deadline |
| Professional Claims Bar Date | June 9, 2025 | Deadline for professional fee claims |
| Post-confirmation rejection damages bar date | May 28, 2025 | Deadline for rejection damages claims after confirmation |
The bar date order also established a notice package, a publication notice requirement, and an amended schedules bar date that runs 21 days from notice of any schedule amendments. For 503(b)(9) claims, the order required proof of delivery and invoice documentation for goods delivered in the 20 days before the petition date.
Key case timeline
| Date | Event |
|---|---|
| 2024-10-14 | Chapter 11 petitions and first day declaration filed |
| 2024-10-15 | Cash collateral motion filed |
| 2024-10-18 | Interim cash collateral order entered |
| 2024-11-01 | Bar date order entered |
| 2024-11-04 | Final cash collateral order entered |
| 2024-11-04 | Bid protections and assignment procedures order entered |
| 2024-11-13 | Sale order entered for Do it Best transaction |
| 2024-11-27 | 503(b)(9) bar date |
| 2024-12-05 | General bar date |
| 2025-01-21 | Initial plan and disclosure statement filed |
| 2025-02-12 | Second amended plan and disclosure statement filed |
| 2025-03-31 | Third amended plan filed |
| 2025-04-14 | Governmental bar date |
| 2025-04-17 | Confirmation order entered |
| 2025-04-25 | Plan Effective Date |
| 2025-04-28 | Notice of Effective Date filed |
| 2025-05-25 | Administrative claims bar date |
| 2025-05-28 | Post-confirmation rejection damages bar date |
| 2025-06-09 | Professional claims bar date |
Frequently Asked Questions
What prompted True Value's chapter 11 filing?
Court filings cite post-pandemic demand normalization, supply chain disruptions, and tightened borrowing base availability as key drivers. Lenders exercised cash dominion and required consent for disbursements, which reduced working capital and pushed the company toward a sale-centered restructuring.
What is the status of the Do it Best transaction?
The transaction was structured as a 363 sale to Do it Best Corp. The company announced a sale agreement and a purchase price of $153 million, and the court entered a sale order on November 13, 2024. Coverage of the filing also highlighted the plan to sell the business to a rival operator.
Are independent True Value stores part of the bankruptcy?
Court filings indicate that member stores are independently owned and are not debtors in the chapter 11 cases, with one company-owned store in Palatine, Illinois as an exception. The debtors presented the case as a restructuring of the wholesale platform rather than the independent retail stores.
When were the plan confirmation and effective dates?
The court entered the confirmation order on April 17, 2025, and the plan became effective on April 25, 2025. Those dates are reflected in the Notice of Effective Date filed in late April 2025.
What were the key bar dates for claims?
The 503(b)(9) bar date was November 27, 2024, the general bar date was December 5, 2024, and the governmental bar date was April 14, 2025. Post-confirmation deadlines included a May 25, 2025 administrative claims bar date, a June 9, 2025 professional claims bar date, and a May 28, 2025 rejection damages bar date.
How does the plan treat creditor classes?
Priority and other secured claims are unimpaired and paid in full in cash or otherwise treated as unimpaired. Prepetition lender claims and general unsecured claims are impaired and receive litigation trust interests and related distributions, while subordinated claims and existing equity interests are canceled with no distribution.
Who is the plan administrator?
Michael I. Goldberg serves as the plan administrator and is responsible for implementing the confirmed plan, administering reserves, and overseeing claim reconciliation and litigation trust activities.
Who is the claims agent for True Value Company?
Omni Agent Solutions serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.
See more Chapter 11 case summaries in the ElevenFlo blog.
