Linens 'n Things had 571 stores — a $1.3B buyout by Apollo killed it in two years

Linens 'n Things was founded in 1975 and grew into America's second-largest home furnishings retailer behind Bed Bath & Beyond. At its peak it operated 571 stores in 47 states and six Canadian provinces, employed 7,300 people, and reported $2.7 billion in annual revenue. It was a solid, profitable chain with a well-known brand and a clear market position.

In February 2006, private equity firm Apollo Global Management acquired Linens 'n Things for $1.3 billion in cash. The buyout loaded the company with debt. Apollo attempted to boost performance with splashy clearance sales, aggressive product promotions, and other new strategies, but the changes failed to gain traction. By the third quarter of 2007, comparable-store sales and customer transactions were declining, the operating loss was $56.6 million, and the net loss had nearly tripled to $79.9 million.

On 2 May 2008, Linens 'n Things filed for Chapter 11 bankruptcy and announced it would close 120 underperforming stores. It tried to reorganise, developing a plan to emerge in early 2009 by reversing many of Apollo's post-acquisition strategies. But the debt was too heavy and the business was bleeding too fast. By October 2008, the company abandoned its restructuring plan, asked the bankruptcy court for permission to auction its remaining 371 stores, and began going-out-of-business sales. All stores closed by 28 December 2008. The online store closed in February 2009.