LL Flooring files for bankruptcy

LL Flooring, the Henrico County flooring company previously known as Lumber Liquidators, announced Sunday it has entered Chapter 11 bankruptcy proceedings and is pursuing a sale of its business.

Also, according to documents filed with the Securities and Exchange Commission, the company has received a nonbinding letter of intent to sell its Henrico County distribution center for approximately $100 million.

The company has more than 300 stores across the country, and it plans to close 94 stores, according to the Sunday news release. Meanwhile, LL Flooring is “in active negotiations with multiple bidders and hopes to seek bankruptcy court approval of a sale of its business in the first few weeks of the Chapter 11 proceedings,” it said.

“After comprehensive efforts to enhance our liquidity position in a challenging macro environment, a determination was made that initiating this Chapter 11 process is the best path forward for the company,” LL Flooring President and CEO Charles Tyson said in a statement. “Today’s step is intended to provide LL Flooring with additional time and financial flexibility as we reduce our physical footprint and close certain stores while pursuing a going-concern sale of the rest of our business. As we move through this process, we are committed to continuing to serve our valued customers, and to working seamlessly with our vendors and partners. I am appreciative of our associates for their ongoing hard work in providing the best experience for our customers.”

Tyson became CEO of LL Flooring in 2020, a year after the company was forced to pay $33 million to settle allegations of securities fraud, and although the company opened 17 stores in 2022, sales fell from $1.11 billion in fiscal 2022 to $904.7 million in fiscal 2023. In June 2023, LL Flooring’s board rejected an unsolicited acquisition proposal from Cabinets to Go, a subsidiary of F9 Brands, which then began a proxy fight.

In July, news broke that LL Flooring was considering filing for Chapter 11 bankruptcy, and shareholders elected three F9 nominees to the company’s board. However, in the August SEC filing, LL Flooring revealed that the three F9 board members resigned shortly after the decision to enter Chapter 11 proceedings.