Armstrong Flooring Sale: What Does the Future Look Like?
Rocking the flooring industry, one of the biggest news stories of 2022 entails the Armstrong Flooring sale. As the only non-liquidating buyer, AHF Products purchased Armstrong Flooring’s North American assets in a bankruptcy sale.
The privately held bidding process included 127 parties interested in exploring participation. However, only two companies submitted qualified bids. Of those two, only one intended to keep Armstrong Flooring going: AHF Products.
The deal was approved by Delaware bankruptcy judge Mary Walrath which sealed the $107 million deal. Now, AHF obtained the right to use Armstrong’s products and brands.
Where Does the Armstrong Flooring Sale Leave Shareholders?
Following the Armstrong Flooring Sale, AHF opted for non-liquidation of assets. This means that AHF holds the option to rebrand and reuse former Armstrong products for use in their other 14 owned brands. Brian Carson, CEO of AHF Products, stated that the company is considering the continuation of many of Armstrong’s most successful sub-brands, including Imperial Excelon, Diamond 10, and Medintech.
Initially, shareholders faced confusion regarding whether they’d receive compensation due to the sale. Having said that, shareholders were left disappointed when it was discovered that, due to the nature of the sale and the company’s outstanding debt, shareholders would not receive anything. The stock closed at 5 cents but once traded for as high as $19.06 in 2018.
Armstrong Settles with Nonunion Retirees and Leaseholders
In bankruptcy court, Armstrong revealed that it settled objections from nonunion retirees on their benefits. The deal for the company includes $350,000. This will be divided amongst 596 nonunion retirees over the age of 65.
After the Armstrong Flooring sale, the flooring manufacturer settled with High Properties Inc, which holds two of their leases for the design center and headquarters and its research and development center. High Properties expects to receive a rent check for August of 2022 ($170,000) and to keep the company’s $100,000 security deposit.
Though not gone forever, Armstrong as many people in the industry know it will change with brands being rearranged, products being changed, and operations being reorganized as AHF finds a new direction for their new flooring company.
For more information on Armstrong Flooring along with our other brands, contact the Chicagoland flooring specialists at Scharm Floor Covering.