In news that's noteworthy but hardly surprising, Harry & David
filed today for bankruptcy.
The Medford-based seller of food and fruits—one of the larger employers in southern Oregon
with 1,950 workers—
says a number of its lenders have agreed to write off much of its debt, allowing it to continue operating with a bit of breathing room.
If so, that would be a welcome sign for the shipper of Moose Munch and Comice pears. That breathing room would also give relief to surrounding Jackson County, which is suffering from a 14 percent unemployment rate and is home to the many of the orchards that supply fruit to Harry & David.
Declining sales have plagued the company (it grosses about $400 million a year) causing it to lay off hundreds of people and back off of its charitable contributions (last year Harry & David reneged on a $100,000 commitment to a local school). But it is also true, as this page has previously noted
, that the company was a classic victim of the casino economy.
Started by Harry and David Rosenberg in 1914, the privately-held firm has been sold several times. The most recent sale came in 2004 to investment bankers Wasserstein
& Company and Highfields Capital Management (who bought it from a
Japanese conglomerate). The owners borrowed heavily to buy the
company and then borrowed again to pay themselves back the down payment.
Subsequently, the firm slashed payroll and trimmed benefits. The CEO was
fired and replaced with someone who lives and works in Atlanta. For the past month, the company has been run by Kay Hong, a turnaround expert.