In late 2005, Apollo Management Group agreed to pay $1.3 billion for Linens 'n Things, taking the company private. It proved to be horrible timing, as the housing market began its dramatic decline.
And the credit markets eventually crumbled, making the investment unworkable. In fact, the company had to file for bankruptcy in May.
Linens 'n Things tried to sell itself. Unfortunately, there were no bidders willing to take on the risks. So, this week the company will undergo a liquidation process.
No doubt, this is a big fall. Last year, Linens 'n Things posted revenues of $2.8 billion and had 589 stores across 47 states. There will also be a real impact on the employee base – which was 17,500 last year – as well as the 1,000 suppliers.
At the same time, expect some bargain-basement prices at local Linens 'n Things stores over the next few weeks.
Tom Taulli is the author of various books, including The Complete M&A Handbook and The Streetsmart Guide to Short Selling: Techniques the Pros Use to Profit in Any Market
He is also the founder of BizEquity, a valuation website
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Reader Comments (Page 1 of 1)
10-15-2008 @ 3:36PM
tinyreef said...
i kicked them out of my shop over a year ago. after the filing they offered me more business under DIP. pass.
it didn't take a genius to figure their business model wasn't going to succeed in the current (back in the summer not this apocalyptic fall!) environment.
i'm sorry they're not going to survive but these retailers reap what they sow.
10-15-2008 @ 6:47PM
lost job for xmas said...
What a goat farm LNT WAS. POOR CORPORATE PREFORMING,MORE VP'S THAN A BANK. DM'S WHO HAD NO RETAILING ,MERCHANDISING SKILLS. THEY TREATED US LIKE DIRT, ALWAYS BLAMING THE STORE LEVEL PERSONAL FOR POOR SALES. I HOPE NONE OF THESE " VP'S &DM'S FIND WORK SOON. THIS COMPANY REACTED INSTEAD OF ACTING. ALWAYS TRAILING WITH FRESH IDEAS. GOOD LUCK CORPORATE,YOU WILL NEED IT. oH, BY THE WAY DAVE CODAR, WERE ALL THE NEWSPRINT STORIES FALSE.......
10-16-2008 @ 12:54AM
Iridium said...
When a supposed 50% liquidation sale still nets prices higher than what you pay for the same product at Bed Bath and Beyond with a coupon you know a place is going to go under.
I walked into a closing store and saw a $25 retail item marked down to $22. When you force your suppliers to give you 70% margin a $3 drop when your store is closing isn't a sale.
Linens was a garbage company. Nothing more than a stock scam. Apollo was completely scammed thinking the company was worth something. After they took it over they found that the company had no worth other than to screw shareholders.
The next company to go this way is Dick's Sporting Goods.
10-16-2008 @ 1:18AM
timeforchange said...
"Linen's N Things goes bye bye" -ouch- Nice to know someone is having fun with these headlines. I work (..humm.. worked)for Linens N Things!!! They (had) over 500 stores in the US, and now they're all closing! LNT went up for auction and was bought by a liquidation company. O well... just another 17 thousand unemployed people...right!?! The more the marrier!! ... So much for Christmas, i'll be lucky to still have a car n' roof over my head... maybe santa'll bring food stamps.. :o( (good luck to all the other LNT employees)
10-19-2008 @ 8:52PM
corporate run around said...
As TEAM liquidation is closing stores, Why on the death conference call: Rich Flatherty was the sacrificial lamb to break the "FALSE" Rumors that we were told. Where was Coder,hiding under his desk. Like a coward who could not lead a cub scout to a candy store. What will his severnce package be. Maybe a stack of coupons.......
11-12-2008 @ 5:15PM
tammy said...
I work for linen and things. Been there for 5 years. It have been a good place to work for. I'm sure all companies make mistakes. I think our prices could have been more competive.All in all they would good to their employees. I work in the distribution center in ky. It will really be a sad time when we close. It is a family like atmosphere, Alot of friends. Iwish all employees the best of luck finding something new. I want to wish all the employees and their families a great holiday season.
11-19-2008 @ 12:07AM
dee said...
Linens-N-Things was such a fun company to work for. I truly love everyone I work with. The prices are not what brought our company down. Apollo is a bunch of asses who bought a casino taking money from LNT. Apollo can suck it....they aren't losing anything. Coder lying to everyone pisses me off too. Screw LNT and the people who own it. I hope you are loving your new homes and cars. Thanks for ruining our Christmas.
12-01-2008 @ 11:44AM
Joan said...
It just so happens I have an unused Gift Card. Where can I redeem it? I live in NE Philadelphia.
Thanks.
12-04-2008 @ 3:13PM
Laid Off Employee said...
You are out of luck with the gift card. LNT does not have to honor those since they filed for bankruptcy.