Conn’s Files Chapter 11 Bankruptcy

Conn’s Inc. (The Woodlands, Texas) has filed for Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas, according to reports posted on several news sites, including Retail Dive. The company’s plans include shuttering 500-plus stores operating under its two banners, Conn’s HomePlus and Badcock Home Furniture & More.

Conn’s CEO Norman Miller said “a convergence of factors” contributed to the decision to file for bankruptcy, Retail Dive notes. Especially of note was its decision to acquire rival retailer W.S. Badcock (Mulberry, Fla.) late last year. That move generated costs that added to Conn’s liquidity challenges, Miller said in court documents.

Analysts seconded that the deal had not worked out as planned. “The acquisition of Badcock last year was arguably a mistake and has cost the company time and capital,” Neil Saunders, managing director of GlobalData, said in an email to Retail Dive. “Expanding in a very soft market was an error.”

Conn’s began selling appliances in Texas in 1937. At the time of its bankruptcy filing, the company said it had 553 corporate and dealer retail stores across 15 states, 22 distribution and service centers and six corporate offices. Badcock, meantime, was founded in 1904 in Florida. Before its deal with Conn’s, the company had 64 corporate locations and 310 independent dealer-owned stores.