COLUMBUS, Ohio — After a bankruptcy announcement last week, True Value says it could be selling the 75-year-old company to its former rival Do It Best.
True Value says it "will continue its day-to-day operations serving 4,500 independently owned retailers,” in a news release.
In a Warn Act notice to the state of Ohio, True Value says 89 Ohioans at a distribution center in Westlake, in Cuyahoga County, could be cut by the end of the year. Hundreds of other jobs may be on the chopping block across the nation. In the notice to the state, True Value says the jobs could be saved if the potential merges comes through
A bankruptcy lawyer and partner at Shumaker, Loop, and Kendrick, with offices in Toledo and Columbus, says a company notifying the court about the jobs ahead of the merger is more common than you think.
“A lot of times when you file a bankruptcy, you're going to tell the court and creditors the reason for the filings, and if there's an anticipated merger or sale of assets or combination of businesses that will help keep jobs, that's a really important reason to share with the court and with creditors,” said Stever Berman. “Oftentimes, we like to lay out, how many locations we're dealing with, how many employees we're dealing with. Sometimes you have to cut jobs, but a lot of times, a bankruptcy will enable a company to keep employees on, and that's obviously important for bankruptcy courts to know.”
Consumer 10 also found major retailers announced more than 6,100 store closures so far this year, already outpacing last year's total of more than 5,500, according to Coresight. Among the closures, include Family Dollar with 677 stores closing, Walgreens also announced 259 locations will close and Denny’s is shutting down 150 restaurants.
“[There] are a number of factors are affecting the numbers of filings, which are up nationally. This is not an isolated situation. Interest rates are causing filings to increase inflation and the cost of consumer products has certainly affected the ability of companies to do business profitably. It's also affected consumers' ability to purchase products,” said Berman. “I think people are very uncomfortable these days with the state of the economy, and I think all of that is causing a lot of bankruptcies to file, and certainly increasing the number of bankruptcies on a year-over-year basis.”
Consumer 10 reached out to True Value to see how customers would be impacted by the potential merger and did not immediately hear back.