It’s a New Year’s miracle: Big Lots will live to fight another day.

The beleaguered off-price retail chain looks like it will come back from the scrap heap of nearly dead home furnishings businesses with the news that retail investment firm Gordon Brothers has put together a deal to save the brand. Exactly what the future Big Lots will look like for both shoppers and suppliers remains to be seen—but given that the company was in the early stages of liquidation, its survival is a pretty remarkable turn of events.

Gordon Brothers—a company that specializes in acquiring declining businesses and resurrecting them (though sometimes it liquidates them)—is buying Big Lots in bankruptcy court, in what is called an “asset-based deal.” Essentially, it is buying the intellectual property, inventory and some stores, but not necessarily its debt or other pieces of the Big Lots business. Following the deal, the investment firm quickly turned around and arranged to sell between 200 and 400 Big Lots locations to Variety Wholesalers, a retail operator whose best-known nameplate is Roses. Variety, which is privately held, currently has about 400 stores—if this deal goes through, it could double its footprint.

Variety has said it will operate the Big Lots locations under the existing name, but some stores could be converted to its other brands. It’s also quite possible that, whatever identity the locations take on, the merchandising mix will end up being closer to Variety’s, which features a less furniture-centric assortment than Big Lots.

For Big Lots, this last-minute rescue adds another twist to its roller-coaster story. The company filed for bankruptcy in September, while at the same time announcing that an affiliate of private equity firm Nexus Capital Management would be buying the business and operating around 1,000 of its approximately 1,400 locations. But Nexus pulled out of the deal in December, causing Big Lots to announce that it would begin the liquidation process and go out of business. Leading that process, by the way, was Gordon Brothers.

The current deal may still not be the final step in this process. The New York Post reported over the holidays that Mitch Modell, the former CEO of the now-defunct New York sporting goods retailer bearing his name, was trying to put together a deal to buy both Big Lots and Party City, another national chain that filed for bankruptcy at the end of 2024 and is now being liquidated. The newspaper said Modell was working to raise $1 billion to fund the acquisitions, but gave no details on who might be supplying the cash. For his part, Modell told the Post that he got the idea for the purchase when he was at Mar-a-Lago with President-elect Donald Trump, and that his strategy team included former CEOs of Forever 21 and Barnes & Noble, two retailers that have led their own troubled lives.

Adding another wrinkle, Reuters reported that some vendors, including mattress suppliers Tempur Sealy and Serta Simmons, were not being paid in the Gordon Brothers deal and objected to the sale. A lawyer for Serta Simmons said that Big Lots had racked up $250 million in debt even after it realized it didn’t have the funds to pay for new orders.

While the deal is underway for now, there may be a few more bumps in the road for Big Lots, if its recent history is any indication.

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Warren Shoulberg is the former editor in chief for several leading B2B publications. He has been a guest lecturer at the Columbia University Graduate School of Business; received honors from the International Furnishings and Design Association and the Fashion Institute of Technology; and been cited by The Wall Street Journal, The New York Times, The Washington Post, CNN and other media as a leading industry expert. His Retail Watch columns offer deep industry insights on major markets and product categories.