True Value files for bankruptcy in order to sell itself to rival

True Value Co. filed for bankruptcy in Delaware on Monday as it seeks to sell its business to rival Do it Best Corp.

The Chicago-based home-improvement company will continue to operate under Chapter 11 protection with Do it Best providing a so-called stalking horse bid, meaning that it’s subject to better offers, should any materialize, according to a company statement. The bidder offered to pay $153 million in cash, according to the bankruptcy filing.

“After a thorough evaluation of strategic alternatives, we determined that the sale of our business was the path forward to maximize value and best serve our retail partners and other stakeholders into the future,” True Value’s Chief Executive Officer Chris Kempa said.

The company “faced significant liquidity challenges” and hired Houlihan Lokey Inc. in May as financial advisor to review options, it said in the filing.

True Value is the latest firm seeking Chapter 11 protection as inflation impacts household spending for discretionary goods in the U.S. Home, clothing and hobby store chains dominate the list of distressed retailers, according to Moody’s Ratings.

True Value is seeking to use its cash collateral to support the business through the sale process, and it has received a commitment from Do it Best to provide additional capital. The company serves a network of 4,500 independently-owned and operated retailers.

It has estimated liabilities between $500 million and $1 billion, and assets between $100 million and $500 million, according to the Chapter 11 filing. Private equity firm Acon Investments purchased a stake in True Value in 2018.

Google backs buildout of small reactors

Alphabet Inc.’s Google is investing in the development of the next generation of nuclear power, backing a company that’s building small modular reactors and agreeing to purchase energy once the sites start supplying U.S. grids.

Google signed an agreement with Kairos Power to construct a series of so-called SMRs that use molten-salt cooling technology. The move is part of an effort to bring online new carbon-free electricity as the company builds out data centers in the next decade, said Michael Terrell, senior director of energy and climate at Google. Power supplies are expected to start between 2030 and 2035.

The deal, which will back 500 megawatts of power, includes Kairos’s 50-megawatt demonstration Hermes project in Tennessee, followed by commercial scale reactors sized at 75 megawatts, the companies said.

Renault, Stellantis see EV sales bounce back

Demand for electric vehicles is showing signs of recovering as prices for plug-in models are coming down, according to Stellantis NV and Renault SA.

“We may be getting close to a tipping point” for EV demand, Thierry Koskas, who heads Stellantis’ Citroën brand, told reporters at the Paris auto show on Monday. Renault Chief Executive Officer Luca de Meo cited an event this weekend where EVs made up 35% to 40% of sales.

Automakers are showing off a range of affordable electric models in Paris this week as they try to compete with Chinese manufacturers expanding in the region. Stellantis, Volkswagen AG and Renault are also contending with an EV demand slowdown sparked by subsidy cuts that pushed up the cost of owning a plug-in car.

Compiled from Bloomberg reports.