FORMERLY PE OWNED
Art Van Furniture
Includes Art Van
furniture · Warren, MI
- PE Firm
- Thomas H. Lee Partners
- Year Acquired
- 2017
PE bought a beloved Midwest furniture chain, sold the real estate out from under it, and liquidated it three years later.
What Happened
- Thomas H. Lee Partners acquired Art Van Furniture for $612.5 million in March 2017, then immediately sold the store real estate in sale-leaseback deals
- The buyout was financed largely with borrowed money, and the sale-leaseback left Art Van paying rent on the stores it used to own outright
- Filed Chapter 11 bankruptcy in March 2020, then converted to Chapter 7 and liquidated the Art Van chain across the Midwest
- THL set up a $1 million hardship fund for laid-off workers, about $400 each, then after public pressure agreed in March 2021 to double its own contribution, taking the fund to roughly $2 million
The Damage Done
- Art Van stores closed for good across Michigan, Indiana, Illinois, and Ohio, wiping out a 60-year-old furniture institution
- About 3,100 workers lost their jobs, many losing promised health coverage and forfeiting up to $525 each in flexible spending accounts, with no severance
- Customers with pending deliveries, layaway orders, and protection plans had to fight through bankruptcy proceedings to recover anything
- Art Van had been the Midwest's largest furniture retailer and a family-owned community pillar. Three years after private equity bought it, every store was gone.
Sources
- What went wrong at Art Van Furniture — Crain's Chicago Business(2020-03-10)
- Art Van Furniture closing its stores — CNN Business(2020-03-05)
- How Art Van went from a retail juggernaut to a house afire — Crain's Detroit Business(2020)
- Private equity firm TH Lee doubles payout for laid-off Art Van workers after bankruptcy — Axios(2021-03-11)
- Art Van Workers Fight for Severance, Insurance After Bankruptcy — Bloomberg(2021-02-10)
- Robert Levin still wants furniture chain back, but Art Van has go-ahead to liquidate — Pittsburgh Post-Gazette(2020-04-08)