Tuesday Morning files for bankruptcy — again
Tuesday Morning Corp. has filed for bankruptcy protection for the second time in less than three years.
The Dallas-based, off-price home goods retailer filed for Chapter 11 bankruptcy protection in the Northern District of Texas in a move to “ultimately transform into a nimbler retailer that serves heritage markets in a profitable manner.” Tuesday Morning, which is burdened with debt and struggling under increased supply chain costs and inflation, listed assets and liabilities of $100 million to $500 million in the filing. It comes about six weeks after the company said it would voluntary delist its stock from Nasdaq amid liquidity issues.
Tuesday Morning, which has 487 stores in 40 states, said it plans to close locations in low-traffic regions while allocating the proper resources to remaining stores in high-traffic region during the restructuring process. It also plans to significantly cut costs across its distribution channels as it pivots to a third-party logistics model and transitions to a more “cost-effective inventory acquisition strategy” for remaining stores.
“After considering how best to address Tuesday Morning’s exceedingly burdensome debt, we have determined that the best path to reorganizing and transforming the company begins with a Chapter 11 filing,” stated Andrew Berger, CEO, Tuesday Morning. "Fortunately, we have the support of a committed capital provider in Invictus and a clear vision for transforming into a focused retailer that serves its core, heritage markets in a profitable manner. We look forward to taking steps that enable us to emerge as a stronger retailer that draws on a legacy of offering a unique off-price value proposition to our loyal customer base.”
Tuesday Morning has obtained a commitment from Invictus Global Management to provide $51.5 million of debtor-in-possession financing to support ongoing operations during the proceedings.
“We look forward to playing an important role in reorganizing and transforming Tuesday Morning,” said Amit Patel, partner of Invictus. “Andrew and his leadership team have our full support as they guide the company through this process and lay a foundation for a brighter future.”
Tuesday Morning previously filed for bankruptcy in May 2020, citing the prolonged closure of its stores amid the COVID-19 pandemic as an "insurmountable financial hurdle." It exited bankruptcy in January 2021, closing approximately 200 stores during the process. Most recently, in September, Retail Ecommerce Ventures, owners of the assets of Pier 1, Dressbarn, Stein Mart and other brands, acquired the majority interest in Tuesday morning.
“We look forward to playing an important role in reorganizing and transforming Tuesday Morning,” said Amit Patel, partner of Invictus. “Andrew and his leadership team have our full support as they guide the company through this process and lay a foundation for a brighter future.”
Munsch Hardt Kopf & Harr, P.C. is serving as Tuesday Morning’s legal advisor, and Vinson & Elkins LLP is serving as legal advisor to Tuesday Morning’s Special Committee. Piper Sandler is serving as financial advisor to the company.
Court filings and other documents related to the court-supervised process are available at https://cases.stretto.com/TuesdayMorning.