True Value Declares Bankruptcy, Set to Sell to Do It Best

True Value, a Chicago-based national hardware retailer with a legacy spanning over 70 years, announced on Monday that it has filed for Chapter 11 bankruptcy and will sell most of its assets to competitor Do it Best.

The company filed for bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware, citing financial challenges. As part of the agreement, Do it Best, another home improvement retailer, will acquire the bulk of True Value’s assets. True Value, founded in 1948, emphasized that it will continue supplying independently owned retailers with products.

“We believe that entering the process with an agreed offer from Do it Best, who shares a similar decades-long history in the home improvement sector, is the best path forward for True Value, our associates, customers, and vendor partners,” said Chris Kempa, CEO of True Value, in a statement.

Independent Stores Unaffected

Despite the bankruptcy filing, the backbone of True Value—its 4,500 independently owned stores—remains resilient and unaffected. This resilience highlights the strength of the company’s business model. True Value operates as a member-owned wholesaler cooperative, selling products to hardware stores, garden centers, industrial distributors, and other merchants.

Do it Best’s CEO, Dan Starr, emphasized that the acquisition represents a significant milestone for the Indiana-based company. “This acquisition, if consummated, would provide True Value and independent hardware stores the strongest opportunities for growth for years to come,” Starr stated, underscoring Do it Best’s strategic vision for the future of the hardware retail industry. The acquisition is expected to bring new resources, technologies, and market opportunities to True Value and its independent stores.

Bankruptcy and Business Continuity

True Value has filed motions with the bankruptcy court to continue paying wages and benefits to its employees while maintaining customer support programs. The company aims to complete the sale by the end of the year.

Despite the bankruptcy, True Value’s extensive network of stores generates $10 billion in retail sales annually, reinforcing its position as a key player in the hardware retail industry. This financial strength is expected to help the company navigate through its current challenges and emerge stronger.

Surge in Business Bankruptcies

True Value’s bankruptcy is part of a broader trend of rising commercial bankruptcies across the U.S. In 2024, business bankruptcies increased by 20% compared to the previous year, with over 22,550 companies seeking protection from creditors, according to data from Epiq AACER. The surge is attributed to rising operational costs from inflation, higher interest rates, and lingering impacts of the COVID-19 pandemic.

Large corporate bankruptcies have also risen, with 113 companies holding more than $100 million in assets filing for Chapter 7 or Chapter 11 in the past year, up from an average of 79 cases in previous years, according to Cornerstone Research. The rise in these bankruptcies reflects ongoing economic pressures, particularly for retailers, and could reshape the landscape of the industry.