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- Turnaround investment firm to provide ongoing funding and operational
assistance to support manufacturers rapid growth; Richter team and creative
corporate culture to remain intact
LOS ANGELES, Nov. 17 /PRNewswire/ -- The assets of Richter Furniture, a
leading manufacturer of better upholstered furniture, have been acquired out
of bankruptcy by an affiliate company of Buxbaum Group, the Calabasas,
Calif.-based turnaround investor.
"Working in tandem with founder Braden Richter and other key members of
his team, we will provide the operational assistance and funding necessary to
allow this company to profitably grow its business," said Paul Buxbaum,
chairman and CEO of Buxbaum Group. "This is a young company whose excellent
product line and solid client base led to rapidly growing sales. But like many
other companies weve worked with, Richter was undercapitalized and not
properly structured operationally to profit from that growth."
Founded in 1997, the company was originally created to service leading
interior designers in Los Angeles and New York. With its customer base
subsequently expanding to include such major upscale retail chains as Crate &
Barrel, Restoration Hardware, Pottery Barn, and Williams-Sonoma Home, the
company shifted production from its 5,000-square-foot facility to a
150,000-square-foot plant on 49th Street in Los Angeles. Annual sales had
grown to approximately $55 million in 2005, and the payroll had expanded to
some 250 employees. But with cash flow insufficient to handle its mounting
debt, Richter filed for Protection under Chapter 11 of the U.S. Bankruptcy
Code on October, 5, 2005.
"We grew too quickly based on the huge success our products recently had
on some of the finest retail floors in the country; it exceeded everybodys
expectations," explained founder Braden Richter. "However, throughout this
process, our customers and our vendors have been extremely supportive."
The companys assets were acquired from the court by Apex Design Group,
LLC, a Buxbaum Group affiliate, through a 363 sale. Apex Design Group, LLC,
d/b/a Richter Design, is the new operating company. David Ellis, president and
chief operating officer of Buxbaum Group, will serve as CEO of the new
operating company, while Braden Richter will continue to direct all design and
creative work as president and creative director.
Additionally, Susan Marschke, has been recruited as chief financial
officer. Ms. Marschke has worked with Buxbaum Group on a number of corporate
turnarounds over the past several years, most recently as CFO of Rampage, the
Los Angeles-based junior apparel manufacturer and licensor that was returned
to profitability by the firm and sold earlier this year to Iconix Brand Group,
Inc. Earlier in her career, Ms. Marschke served as CFO of Dayrunner and was
previously with Deloitte & Touche.
"While we will also be looking to bring other highly qualified
professionals on board to fulfill specific organizational needs, our intention
is to keep the very talented team assembled by Braden intact and maintain the
companys creative corporate culture," Mr. Buxbaum said. "In the months ahead,
we will be working with Bradens team to realign the companys operations at
all levels to more efficiently meet the delivery demands of its clientele,
while maintaining Richters high standards for quality design, fabrics and
craftsmanship. We expect that these measures will foster a return to
profitability."
"I am excited and honored to be able to work with David and Paul," Mr.
Richter said. "They have a strong history of success and bring experience and
financial ability to a company that has immeasurable creativity and energy. I
think the partnership could not be more perfectly balanced."
About Buxbaum Group
Buxbaum Group, together with affiliate Buxbaum/Century, had built its
reputation for over 30 years as one of the largest liquidators and appraisers
of retail and wholesale inventories, as well as machinery and industrial
equipment, across North America. While continuing to operate in those areas,
the company has shifted its primary focus in recent years to turnaround
investing along with specialty financing. Additionally, a subsidiary, Pathway
Strategic Partners, LLC, provides turnaround, expansion and/or downsizing
strategies, in conjunction with other advisory consulting and management
services.
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