Bankrupt Gardena-based home decor chain Z Gallerie has accepted a $20.3 million buyout offer from an Indiana-based savings club retailer.
DirectBuy Home Improvement Inc.’s bid included $7.7 million in cash and $12.6 million in debt provided by KKR Credit Advisors and B. Riley Financial Inc. DirectBuy is a subsidiary of CSC Generation, an ecommerce company created by investor and tech entrepreneur Justin Yoshimura.
As part of Z Gallerie’s bankruptcy plan and the sale, the retailer will lay off 196 employees and close all but 35 of its brick-and-mortar sites. The company will also maintain its Gardena warehouse that served as its headquarters.
Mark Weinsten, interim chief executive of Z Gallerie, said in a letter to the state’s Employment Development Department last month that DirectBuy was interviewing employees and could retain some of them once the transaction is completed.
Z Gallerie, like many traditional retailers, has been roiled by the march of ecommerce. Founded in 1979 by siblings Joe Zeiden, Carole Malfatti, and Mike Zeiden, Z Gallerie sold furniture, art and accessories online and across 76 locations throughout the United States.
Z Gallerie filed for bankruptcy in March as it struggled to keep up with the changing retail landscape. It was the second bankruptcy for the company since 2009.
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