Do It Best Seeks To Acquire True Value

The pending acquisition of True Value by Do it Best represents a significant consolidation in the hardware industry. Here’s a summary of the current status:

Bankruptcy Filing and Sale Agreement

True Value Company, a major hardware wholesaler and brand, filed for Chapter 11 bankruptcy protection on October 14, 2024. Simultaneously, the company announced an agreement to sell substantially all of its business operations to Do it Best Corp., a member-owned cooperative in the hardware industry.

Do it Best’s Bid

Do it Best has been designated as the “stalking horse” bidder in the sale process. This means Do it Best’s offer serves as the initial bid, setting a minimum price for True Value’s assets. The agreement provides significant cash consideration and assumes meaningful liabilities related to the ongoing business.

Strategic Significance

Dan Starr, President and CEO of Do it Best, emphasized the strategic importance of this acquisition, stating it would represent a milestone for Do it Best and home improvement retailers worldwide. If successful, the acquisition would create a global store network exceeding 8,000 locations across more than 50 countries.

Operational Continuity

During the bankruptcy proceedings, True Value continues its day-to-day operations, serving 4,500 independently owned retailers. The company is using its cash collateral to fund operations, with Do it Best committing to provide incremental capital if needed.

Timeline and Process

The sale process is moving forward under Section 363 of the Bankruptcy Code. As of October 31, 2024, True Value and its secured lenders reached a milestone agreement to avoid liquidation and push the sale to Do it Best forward. The revised timeline aims to close the sale by November 22, 2024.

Key Dates

• November 4: Bidding procedures hearing
• November 8: Bid deadline and sale objection deadline
• November 11: Potential auction (if there’s a qualifying bid other than Do it Best’s)
• November 12: Sale hearing
• November 22: Target closing date

Financial Aspects

The agreement with lenders allows True Value to recoup $163.27 million of the $238 million owed when it filed for bankruptcy. Do it Best reportedly increased its offer by $2.7 million to help move the sale forward.

Impact on Stores and Employees

True Value stores, being independently owned, are not part of the Chapter 11 proceedings, except for one company-owned store in Palatine, IL. Do it Best had a deadline of November 8 to make written offers of employment to True Value employees.

Industry Implications

This acquisition, if consummated, would significantly reshape the independent hardware & home improvement industry. It could provide True Value retailers with access to Do it Best’s programs, buying power, and support network.

David Shiller

David Shiller is the Publisher of LightNOW, and President of Lighting Solution Development, a North American consulting firm providing business development services to advanced lighting manufacturers. The ALA awarded David the Pillar of the Industry Award. David has co-chaired ALA’s Engineering Committee since 2010. David established MaxLite’s OEM component sales into a multi-million dollar division. He invented GU24 lamps while leading ENERGY STAR lighting programs for the US EPA. David has been published in leading lighting publications, including LD+A, enLIGHTenment Magazine, LEDs Magazine, and more.

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