As part of continuing Chapter 11 bankruptcy proceedings, Indianapolis-based hhgregg Inc. has announced an agreement to conduct sales at its remaining 132 stores and distribution centers. The company calls the arrangement with Tiger Capital Group LLC and Great American Group LLC "a precautionary measure" should it not receive any "acceptable going concern bids" by April 7. A deal two weeks ago to acquire the appliance and furniture retailer was called off around a week after an anonymous buyer had been identified.
Proceeds of the sale, which is slated to begin April 8, will go toward offsetting what the company owes to lenders and the sale consultants. Earlier this month, hhgregg said it would close 88 store and three distribution centers in the U.S. in an effort to return to profitability. The consultants are set to receive 1.25 percent of proceeds from the sale of merchandise, which hhgregg says includes merchandise and the disposal of "certain furnishings, trade fixtures, equipment and improvements to real property."
In a filing with the U.S. Securities and Exchange Commission, hhgregg says: "based on the terms of the Consulting Agreement, the Company does not anticipate any value will remain from the bankruptcy estate for the holders of the Company’s common stock, although this will be determined in the continuing bankruptcy proceedings."