Great American Group LLC has put in a $5.2 million stalking horse bid to buy the inventory of Domain Home and liquidate the furniture chain, which filed for bankruptcy protection last month.
Such a bidding procedure is sometimes used to establish a minimum bid. Under an agreement between Great American and Domain, Great American would get a $120,000 break-up fee if it is not the successful bidder.
In addition, Great American would pay about 64 cents on the dollar-cost value of the inventory, estimated at $8.5 million. It would also pay a minimum of $75,000 to bring in additional goods to sell during the liquidation and pay the ongoing cost to run the stores, such as for employee salaries, said Maura Russell of Dreier LLP, which is representing Domain in the bankruptcy proceedings.
If the Great American bid is approved in US Bankruptcy Court on Friday, a liquidation sale could begin as early as Saturday.
Hudson Capital Partners LLC, another national liquidator, said yesterday it is also considering bidding for the Norwood business. Hudson Capital chief executive James Schaye has a minority stake in Domain Home under another company known as Golden Acquisition, where he serves as managing partner.
Bids for the 27-store chain are due today at noon. The auction will begin tomorrow.
Domain's bankruptcy case comes less than a year after a New Jersey private investment firm, Synergy Enterprises LLC, bought a majority stake in the furniture chain with plans to open up to 15 more stores in three years. But a prolonged housing slump and declining sales changed the plans.
In the past week, home furnishings chain Fortunoff and Wickes Furniture have also filed for bankruptcy protection.
Jenn Abelson can be reached at abelson@globe.com.
