Franchise Group Inc., the parent company of Pet Supplies Plus, The Vitamin Shoppe, and Buddy’s Home Furnishings, has filed for Chapter 11 bankruptcy protection in a bid to restructure its financial obligations. Despite the filing, the company assured customers and franchisees that its operations, particularly for Pet Supplies Plus, will remain unaffected.
Pet Supplies Plus CEO Chris Rowland emphasized that the brand will continue to operate as usual. “Everything remains business as usual,” Rowland assured, noting that the company is experiencing strong growth and positive cash flows. Franchise locations for Pet Supplies Plus and Wag N’ Wash are not part of the bankruptcy proceedings, and all stores will remain open, continuing to serve customers in-store and online, while honouring gift cards, rewards, and promotions.
The Chapter 11 proceedings, filed in the US Bankruptcy Court for the District of Delaware, aim to reduce the company’s debt, improve liquidity, and support the continued growth of its key brands. Franchise Group’s President and CEO, Andrew Laurence, stated that the restructuring will allow the company to better position its businesses for long-term success. “This is a pivotal step forward in enabling our market-leading businesses to realize their full potential,” Laurence said.
As part of the bankruptcy process, Franchise Group entered into a restructuring support agreement with holders of approximately 80% of its first lien debt. The agreement outlines plans to convert much of the debt into equity, which will significantly reduce liabilities and strengthen the company’s capital structure.
The company also announced it would wind down its American Freight business due to sustained inflation and challenges in the durable goods sector, with store closures set to begin on November 5. Franchise Group has secured $250 million in financing to maintain operations during the restructuring process.
