Thanks, Ann, I certainly hope they get the company straightened out and make a go of it.

Sherry

I have no idea what a stalking horse bidder is.

But the numbers here

"Jackson & PerkinsÂfounded in 1872 and famous for its roses became part of the Park Seed group in 2007. Former owner Harry & David Holdings sold most of the assets of the $73.8 million Jackson & Perkins for roughly $21 million to an investment group." Remembering that J&P's growing fields were sold separately, I just don't understand the eroding of the value of J&P, much less the eroded value of Park Wayside.

Here is a link that might be useful: Some $numbers from a few years ago

A stalking horse bidder is simply a party that sets the bar in the bidding process. It's related to the starting point an auctioneer chooses. The funny thing is that J&P Park Acquisitions was the stalking horse, and that is simply a company set up by the Hachenbergs themselves. They owned the company being sold, but were allowed to set the baseline bid.

All of the respective companies in the deal appear to be subsidiaries of Park Seed. From looking back over several articles, I saw where the Hachenbergs borrowed $12.5 million to buy J&P, and paid $21 million in the deal. They were later sued by previous owners for breach of contract, but I can't find any results showing a judgment in favor of the previous owners.

Hachenberg is the guy behind Re/Max realty & many other businesses in Florida. This entire deal may have been a way to reduce income and lower his tax burden, but who knows? It almost seems to me like J&P was purchased & allowed to wither away and die on purpose.

The eroded value was due to debt. Quite simply, they kept racking up debt when they couldn't pay bills in the first place. They didn't have enough assets to cover it. Previous trustees had stated that they couldn't reconcile the books on Park's inventory. The aggravating thing is that it's not a publicly traded company, so you can't get into their financial statements & actually analyze how they tanked.

Well, it's not all that hard to speculate how they tanked. I have no insider info, and everything I have came from news articles also, but one sees this often in these cases where Wall Street has done leveraged buyouts of old name companies. This April 2007 article re Harry & David sale of J&P says Harry & David got $46 million in cash when they sold J&P to the Hachenbergs. Most of that was probably leveraged debt secured by the assets of J&P, which ultimately doomed J&P to fail.

I did see an approx $800,000 judgment for unpaid royalties to David Austin LLC -- apparently none of the royalties due for the English roses ever got paid after the Harry & David buyout. That and all of J&P's other normal operating costs and credit would probably be amongst the unsecured debt, which means those folks would get close to nothing in the bankruptcy proceeding.

As for the bankruptcy, I would further speculate that that the bankruptcy judge wiped out the debt and sold only the assets to the new owner for that $12.8 million price they announced.

Then the folks who had held J&P's $44.79 million in listed current debt probably got the $12.8 purchase price divided amongst them, with secured creditors being paid first. And probably the secured creditors were the Wall Street bankers that structured the buyout a few years back. And the whole buyout deal was probably based on a glowing set of financial projections, probably made by those same Wall Street bankers at the time. And those bankers probably also made huge fees for that leveraged buyout deal.

And pure speculation here -- but isn't it interesting that the $12.8 purchase price is just about the same as the $12.5 that your article said was borrowed when the leveraged buyout was done. Guess who got made whole?

Gotta love Wall Street and those free market enthusiasts who vote against "goverment interference" (i.e. regulation) of what they do -- the Wall Street bankers consistently found themselves big fees and secured debt on the backs of older companies for whom they convinced owners to do these leveraged buyouts. And now the companies fail under the weight of that debt load and we are surprised? I'm not.

You guys need to read more of the articles.

First, the $41.3M included the land which the Hachenberger's did not buy.

Secondly, the bankruptcy filings mentioned mismanagement.

Lots of good employees, J&P and Park names and lots of customers were hurt with people at the top that didn't know how to run a company. Hopefully, there are good people calling the shots now.

Here's another article. http://multichannelmerchant.com/crosschannel/0824-blackstreet-capital-acquires-park-seed-jackson-perkins/

There's no mention in all of this of the guy who was president of J&P (When it moved to Greenwood SC) who was also head of a company in Hodges SC (which is just up the road from Greenwood and was the home of Wayside) which was for growing out plants from cellular starts. The name was something like Sun Microsystems. The 'money that was' seems to have kept that entity separate. (As opposed to the Powers that Be.)

What a mess, what a mess. Makes me angry & sad at the same time. I found the bankruptcy case where all of them were consolidated under one entity for purposes of resolving this mess. It's Case No. 10-02431-jw, United States Bankruptcy Court, D. South Carolina.

Someone above thinks they're funny; Charles Fox was the president of all of these companies, which were all housed at the South Carolina location. Read this case & you'll see what a mess this was.

Ann, I believe the company you're trying to recall is one owned by the Hachenberg family. They own many businesses. I'm with Kathy in suggesting that this was a way to make sure they ended up whole, but I also think it was to use Park/Wayside/J&P as a way to reduce income for a couple of years.

Blackstreet, the eventual purchaser, was behind the Hachenberg's initial bid to buy their own company back (stalking horse bid) via the J&P Park Aquisitions name.

Even more criminal is the Simmons mattress company story, a very profitable company that paid and treated its "ordinary" employees respectfully and well. Wall Street essentially looted the company, destroying solid middle class jobs. It's happened over and over again. No wonder our economy is in the toilet. If you have not read this story, it's an eye-opener about what is really happening in this country.

To link this back to roses... :) ...without middle class jobs, who is going to be able to afford to buy roses?

Here is a link that might be useful: nyt story on destruction of Simmons

Personally, I'll be going on the Rose Lovers' Diet. Eat less food, more money for roses. :)

"without middle class jobs, who is going to be able to afford to buy roses?"

No one - that's the point. The new business models don't require customers, just Bailouts and debt tricks, so why bother paying workers at all?

flaurabunda,
I like your "Rose Lover's Diet". Might as well get a reward for all our hard work. lol :P

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An earlier court decision found that funds of Park Seed, the Hachenbergers themselves, and J&P have been so hopelessly commingled that for purposes of litigation, the court would consider them to be one entity: Park Seed.
That entity was sold to ?Blackstone.?

If we see J&P again, I believe it will be nothing but a zombie.
I was told, definitely, that there will be no more crops of J&P roses.

Jeri