All Those Empty Shelves Mean Bankruptcy for Store-Display Maker

(Bloomberg) -- Fleetwood Industries Inc., which makes fixtures for retailers, became the latest victim of the retail apocalypse Monday when it filed for Chapter 11 bankruptcy in Delaware.

The relatively small, Pennsylvania-based company counts big, distressed retailers like J.C. Penney Co., Neiman Marcus Group and Destination Maternity Corp. among its customers, according to its website. Fleetwood listed as much as $50 million each in assets and liabilities in its bankruptcy petition and posted $70 million in sales last year, court papers show.

Some of the company’s customers this year started delaying orders, extending project time lines and slow-paying invoices amid the retail industry’s slump and tariffs levied on China, attorneys for Fleetwood said in court papers. The tariffs also boosted the cost of materials for Fleetwood, which makes things like checkout counters and tables, and an investment in a new manufacturing facility sapped cash from the company, according to the documents.

Fleetwood sought new financing in recent months but was unable to find a source, so it instead filed for bankruptcy. The company intends to use the process to streamline its operations and “emerge as a strong business partner for their many valued customers and suppliers,” according to the papers.

Fleetwood is a portfolio company of private equity firm Grey Mountain Partners LLC, according to court papers and the firm’s website. A Brookside Mezzanine Partners fund also owns a small portion of the company’s equity and provided subordinated debt as part of a 2014 recapitalization deal, according to a statement at the time.

Neither Fleetwood nor Grey Mountain immediately responded to requests for comment.

The case is Fleetwood Acquisition Corp., 19-12330, U.S. Bankruptcy Court for the District of Delaware

--With assistance from Sally Bakewell.

To contact the reporter on this story: Jeremy Hill in New York at jhill273@bloomberg.net

To contact the editors responsible for this story: Rick Green at rgreen18@bloomberg.net, Dawn McCarty, Boris Korby

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