Value City’s Parent Company Files for Chapter 11 Relief

American Signature Inc. (Columbus, Ohio), owned by Schottenstein Stores Corp. (Columbus, Ohio), and operator of 120 stores and 3000 employees, has filed for Chapter 11 bankruptcy relief, according to a company statement.

The parent company of Value City Furniture and American Signature Furniture says its decreased sales were due to “one of the most severe housing market declines in recent history,” Retail Dive reports. The company has already commenced liquidation sales and will be closing 33 stores across its portfolio.

In 2021, American Signature Inc. saw a sales increase of 37 percent. More recently, from 2024 through 2025, the company had a net sales drop of $150 million.

In the two years preceding the filing, the company tried to resolve its financial issues on its own: It accepted unsecured loans totaling $51 million from equity holders during those two years and, in December 2024, an affiliate entered into an ABL (asset-based lending) facility loan and gained $50 million in liquidity.

The company reportedly has between 1000 and 5000 creditors ranging between $500 million and $1 billion in liabilities. Some of its unsecured creditors include Tempur-Pedic North America, Ashley Holdings FL and Sealy Mattress Manufacturing.

For now, the company plans to enter a stalking horse purchase agreement with its current equity holders and has secured approximately $50 million from Second Avenue Capital Partners LLC (Boston) in debtor-in-possession financing. “Subject to court approval, this financing will support certain operations and the company’s efforts to maximize value through the chapter 11 cases and sale process,” the company statement reads.