Uncomfortable Times for True Value: Traditional Brand Sets Course for Sale

True Value, a long-standing player in the hardware market with a 75-year history, has filed for bankruptcy and is on the verge of being sold to a competitor. The announcement was made on Monday and could significantly alter the landscape of the retail sector. During the Chapter 11 bankruptcy proceedings, True Value will continue its daily operations, including the sale of hardware and home improvement supplies to its approximately 4,500 independently operated locations. These locations are not affected by the proceedings and will remain open. The plan includes a $153 million acquisition offer from competitor Do it Best, which serves as a so-called 'stalking horse'. True Value's financial difficulties reflect the issues facing the entire industry. With a declining real estate market and more selective consumers regarding luxury goods, the company is experiencing a considerable liquidity crisis. While larger competitors like Home Depot and Lowe's have also faced setbacks since the pandemic-induced boom, they are in a significantly better financial position than True Value. Other chains, such as Big Lots and LL Flooring, have encountered similar challenges that forced them into bankruptcy. In a statement, True Value CEO Chris Kempa emphasized that the sale of the company is the best way to maximize value for all parties involved and to preserve the interests of retail partners. The transaction with Do it Best could be completed by the end of the year, unless better offers are received. Do it Best, a cooperatively managed wholesaler, aims to enhance growth opportunities for True Value and independent retail chains through this acquisition. CEO Dan Starr cited the efficiency and profitability of his company as key factors for success.