Linens 'n Things
Encyclopedia
Linens 'n Things is an online retailer of home textiles, housewares and decorative home accessories. Until 2008, the company also did business as a big box retailer under the name Linens 'n Things, Inc., headquartered in Clifton, New Jersey
, United States
, and did business across the United States and Canada. The chain operated 571 stores in 47 U.S. states and six Canadian provinces, and had 7,300 employees as of December 2006.
The struggling company began liquidating its remaining stores in October 2008 after many previous store closures.
The company's business strategy was "to offer a broad selection of high quality, brand name home furnishings merchandise at exceptional everyday values, provide superior guest service, and maintain low operating costs."
The relaunch of the company as an online retailer was announced in February 2009 on its former website, LNT.com. Following the conclusion of business on the original website on February 15, 2009 customers were redirected to the online store's new home, originally located at
The company was acquired in February 2006 by Apollo Global Management, a private equity
limited partnership
, for $1.3 billion. As a part of the transition from a public company to the private-owned business, the position of CEO went from Norman Axelrod to Robert (Bob) DiNicola; alongside of him were several executives such as F. David Coder who is President and Omer Fancy who is the executive Vice President of Marketing.
According to Form 10-Q filed with the U.S. Securities and Exchange Commission for the quarterly period ended September 29, 2007, Linens Holding Co. and subsidiaries (including Linens 'n Things, Inc. acquired in February 2006 for cash of approximately $1.3 billion) reported net sales of $666.8 million, versus $658.2 million in the year-earlier period. The increase in net sales was primarily due to the opening of new stores since Sept. 30, 2006 offset by the impact of a decline in comparable store sales. The decline in comparable store sales was primarily due to a decline in customer transactions partially offset by an increase in average transaction value.
The operating loss (after a charge of $16.8 million for impairment of property and equipment in the more recent quarter) was $56.6 million against a loss of $17.9 million a year ago. After net interest expense and other income & expense, the loss before income taxes was $79.2 million compared to a loss of $41.7 million. After provision/benefit for income taxes, Linens Holdings reported a net loss of $79.9 million versus a net loss of $27.4 million.
On April 17, 2008, the New York Post reported that the company was seeking to sell its highly profitable Canadian Division, but no one at Linens 'n Things would confirm nor deny this, saying only that an adviser had been hired to explore strategic alternatives. Ultimately the Canadian Linens 'n Things stores would meet the same fate as their American counterparts.
. Chief among those tactics was a shift to splashy clearance sales and product promotions. Revised management wished to return Linens 'n Things to an "everyday, low price" model it had pursued during its earlier years as a public company. It also wished to improve the quality of its merchandise and to keep shelves stocked in timely fashion, the paper said.
On October 7, 2008, Bloomberg News reported that Linens 'n Things asked the Bankruptcy
Court for permission to auction the remaining 371 stores and hold store closing sales. On October 14, the company announced its official sale to a group of liquidators. The company began liquidation sales at its remaining stores in both the United States and Canada and on the chain's website, LNT.com, on October 17. The sales concluded on December 28, 2008 in all stores, but Linens 'n Things continued the liquidation sale on its website until February 15, 2009.
Clifton, New Jersey
Clifton is a city in Passaic County, New Jersey, United States. As of the 2010 United States Census, the city had a total population of 84,136. The 2010 population represented an increase of 5,464 residents from its population of 78,672 in the 2000 Census, making it the state's 11th largest...
, United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, and did business across the United States and Canada. The chain operated 571 stores in 47 U.S. states and six Canadian provinces, and had 7,300 employees as of December 2006.
The struggling company began liquidating its remaining stores in October 2008 after many previous store closures.
The company's business strategy was "to offer a broad selection of high quality, brand name home furnishings merchandise at exceptional everyday values, provide superior guest service, and maintain low operating costs."
The relaunch of the company as an online retailer was announced in February 2009 on its former website, LNT.com. Following the conclusion of business on the original website on February 15, 2009 customers were redirected to the online store's new home, originally located at
thenewlnt.com (but has since relocated to the old website, lnt.com).Acquisition and trouble
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
limited partnership
Limited partnership
A limited partnership is a form of partnership similar to a general partnership, except that in addition to one or more general partners , there are one or more limited partners . It is a partnership in which only one partner is required to be a general partner.The GPs are, in all major respects,...
, for $1.3 billion. As a part of the transition from a public company to the private-owned business, the position of CEO went from Norman Axelrod to Robert (Bob) DiNicola; alongside of him were several executives such as F. David Coder who is President and Omer Fancy who is the executive Vice President of Marketing.
According to Form 10-Q filed with the U.S. Securities and Exchange Commission for the quarterly period ended September 29, 2007, Linens Holding Co. and subsidiaries (including Linens 'n Things, Inc. acquired in February 2006 for cash of approximately $1.3 billion) reported net sales of $666.8 million, versus $658.2 million in the year-earlier period. The increase in net sales was primarily due to the opening of new stores since Sept. 30, 2006 offset by the impact of a decline in comparable store sales. The decline in comparable store sales was primarily due to a decline in customer transactions partially offset by an increase in average transaction value.
The operating loss (after a charge of $16.8 million for impairment of property and equipment in the more recent quarter) was $56.6 million against a loss of $17.9 million a year ago. After net interest expense and other income & expense, the loss before income taxes was $79.2 million compared to a loss of $41.7 million. After provision/benefit for income taxes, Linens Holdings reported a net loss of $79.9 million versus a net loss of $27.4 million.
On April 17, 2008, the New York Post reported that the company was seeking to sell its highly profitable Canadian Division, but no one at Linens 'n Things would confirm nor deny this, saying only that an adviser had been hired to explore strategic alternatives. Ultimately the Canadian Linens 'n Things stores would meet the same fate as their American counterparts.
Bankruptcy and liquidation
On May 2, 2008, Linens 'n Things filed for Chapter 11 bankruptcy and closed 120 stores. In August 2008, Linens 'n Things devised a plan to emerge from bankruptcy early in 2009. Under the plan, the retailer intended to reverse many of the strategies introduced after the company was bought by Leon BlackLeon Black
Leon David Black is an American businessman and money manager, with a focus on leveraged buyouts and private equity. He is a son of Eli M. Black , a prominent businessman who controlled the United Brands Company and committed suicide when caught paying bribes to the President of Honduras...
. Chief among those tactics was a shift to splashy clearance sales and product promotions. Revised management wished to return Linens 'n Things to an "everyday, low price" model it had pursued during its earlier years as a public company. It also wished to improve the quality of its merchandise and to keep shelves stocked in timely fashion, the paper said.
On October 7, 2008, Bloomberg News reported that Linens 'n Things asked the Bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
Court for permission to auction the remaining 371 stores and hold store closing sales. On October 14, the company announced its official sale to a group of liquidators. The company began liquidation sales at its remaining stores in both the United States and Canada and on the chain's website, LNT.com, on October 17. The sales concluded on December 28, 2008 in all stores, but Linens 'n Things continued the liquidation sale on its website until February 15, 2009.