Urethane Blog
Prestige Update
October 12, 2023
Business Court judge approves sale of Klaussner business unit
- Richard Craver
- Oct 9, 2023
An N.C. Business Court judge approved on Oct. 2 a Canadian home furnishings manufacturer’s $7 million offer for the Prestige Fabricators business unit of defunct Klaussner Furniture Industries Inc. of Asheboro.
As part of the transaction, VPC Foam USA Inc. would acquire the leases for the 2206 Dumont St. and 905 N.C. South 49 facilities in Asheboro.
The Business Court has oversight of the Prestige properties via a complaint filed in the court by Bank of America Corp. related to its Klaussner loans.
VPC would enter into new leases for both facilities effective with the closing dale of the overall sale. VPC said in its offer that it “intends to operate the Prestige business and will hire a substantial number of former employees to work in the business.”
Klaussner listed in its WARN notice to the N.C. Commerce Department having 127 at its 905 N.C. 49 South, Asheboro plant and 26 at its 2206 Dumont St. plant.
Klaussner entered into federal bankruptcy protection on Aug. 8, immediately shutting down operations and is letting go of 893 employees following an inability to access additional funding from its lender. Klaussner had been in business since 1963.
Klaussner said the tipping point for the decision was that its lending source “unexpectedly refused to continue to fund the company’s operations. This outcome was not reasonably foreseeable, but due to these unexpected circumstances, Klaussner can no longer sustain its operations.”
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