Noble House files Chapter 11, lines up $85 million stalking horse deal

By Sarah Lizee

Olympia, Wash., Sept. 12 – Noble House Home Furnishings LLC filed Chapter 11 bankruptcy on Monday in the U.S. Bankruptcy Court for the Southern District of Texas.

The company said in court documents that it made the filing in response to current market conditions, including high inflation and softer consumer purchases in the furniture space.

The debtor plans to effectuate a going-concern sale of its assets to a proposed stalking horse buyer, GigaCloud Technology Inc., subject to an auction process and any higher and better bids.

The stalking horse agreement provides for a purchase price of $85 million, subject to a working capital adjustment, plus $4.11 million for equipment, in addition to assumed liabilities.

The outside closing date under the agreement is Oct. 31.

The company is seeking approval of a $12.2 million new-money debtor-in-possession revolver with prepetition lender Wells Fargo Bank, NA as DIP agent and lender.

Following a final order, the facility will also include a rollup of prepetition debt.

Interest on the DIP facility will be equal to the base rate plus 450 basis points per annum.

Fees include a 0.25% closing fee, a 1.5% sale transaction fee, a collateral management fee of $3,333.33 per month, and an unused facility fee of 0.25% if the average revolver usage is greater than 50% of the maximum revolver amount and 0.375% if usage is less than or equal to 50%.

The facility is set to mature on Oct. 31.

The company is also seeking approval to use cash collateral.

In its petition, the company listed 1,000 to 5,000 creditors, $100 million to $500 million in assets and $100 million to $500 million in liabilities.

Its largest unsecured creditors are Jiang Su Chairone Home Furniture Co., Ltd., based in Jiangsu, China, with a $4.2 million trade debt claim, HA Thanh Import-Export Co. Ltd., based in Quy Nhon City, Vietnam, with a $4.05 million trade debt claim, Wegmans Furniture Industries, based in Muar, Malaysia, with a $3.09 million trade debt claim, Phu Tai Joint Stock Co., based in Phuoc Thanh, Vietnam, with a $2.89 million trade debt claim, and Suzhou Shushi Furniture Co. Ltd., based in Jiangsu, China, with a $2.19 million trade debt claim.

Pachulski Stang Ziehl & Jones LLP is the debtors’ proposed counsel, and Riveron is financial adviser.

The Chatsworth, Calif.-based home furniture company filed bankruptcy under Chapter 11 case number 23-90773.

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