Carls Furniture files for Chapter 11
Clint Engel -- Casual Living, May 25, 2011
Carls Furniture filed for Chapter 11 bankruptcy protection Tuesday, citing weak business and the housing slump.
In the filing, anticipated by many in the industry for some time, Carls listed assets of $6.1 million and debts of $9.1 million. A dozen industry-related companies are listed among its 20 largest unsecured creditors and owed $2.4 million, led by Klaussner with two claims listed - $366,683 for inventory and another claim listed for JDI Klaussner for $218,902.
Other industry creditors include Century, owed $292,896; Leather Trend, owed $199,379; and Lane, owed $189,946, according to court documents. All told, unsecured creditors are owed $8.3 million, according to court documents.
Carls is unaffiliated with Carls Patio, which is unaffected by the bankruptcy. Carls Furniture sold its interest in the outdoor chain in 2008 in a buyout led by Carls Patio management and investment firm Weinberg & Bell.
Carls Furniture President Jeff Baker could not be reached immediately for comment.
In a report by the South Florida Sun-Sentinel, Baker blamed falling housing sales on the subsequent drop in furniture sales, and said the filing will enable the retailer to stay open while reorganizing.
Carls has seven South Florida stores, though two - in Boca Raton and Kendall, Fla., - are in the process of liquidating and the locations will be taken over by Havertys and Baer's, respectively.
In a statement obtained by the Sun-Sentinel, Carls parent Furniture Land said it will close unprofitable stores in the next 60-90 days "and obtain reduced rent on the remaining stores that are continuing in operation."
It is unclear how many stores Carls expects to operate following the reorganization.
Carls' filing follows the February bankruptcy filing for Fort Myers, Fla.,-based Robb & Stucky, which subsequently moved to total liquidation.
Here's a list of top industry-related creditors and their claims:
+ Klaussner Furniture, $366,682
+ JDI Klaussner, $218,902
+ Leather Trend doing business as Richter Design, $199,379
+ Lane Home Furnishings, $189,946
+ Lauren Ralph Lauren, $179,581
+ Natuzzi, $174,083
+ Rachlin Group, $145,455
+ Bernhardt, $114,520
+ CIT Group Commercial Services, $134,746
+ Jonathan Louis International, $114,020
+ American Drew, $103,440
+ Schnadig, $99,546
+ Stearns & Foster, $96,322
Furniture/Today Staff Writer Heath E. Combs contributed to this report.