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(MT file photo) Pursuing a rosier future Harry & David is selling Jackson & Perkins to Florida investors for a better cash balance and to re-emphasize gourmet foods and gifts By GREG STILES Mail Tribune The bloom has come off Harry & David's long-standing marriage to Jackson & Perkins. After 41 years, they are parting ways. Harry & David Holdings Inc. said Monday it is selling its rose-growing and wholesale unit, Jackson & Perkins, and its Wasco, Calif., real estate holdings for a total of $49 million. Florida horticulture investors Donald and Glenda Hachenberger have agreed to purchase Jackson & Perkins' brand, including direct marketing, wholesale, rose crops and patents, while a private investment group is buying the company's 3,200 acres, buildings and equipment in Wasco, Calif. The deals are due to close by June 30, but could be wrapped up in April or early May, said Bill Williams, Harry & David president and chief executive officer. None of the 90-plus local Jackson & Perkins employees will be immediately affected, he said, adding that many will be absorbed by Harry & David during a 15-month transition period. "If you look at this company as an outsider, I would say it clarifies our strategic focus on gifts and food without a gardening substrategy," Williams said. "From the inside, it's bittersweet. We've been associated with Jackson & Perkins since 1966. There's an emotional attachment to both the business and the people. It's like sending your kids off to college." Advertisement Donald Hachenberger, one of the founders of RE/MAX International, owns Southern Sun, a technology company involved in plant propagation, and a stake in Park Seed Co., which owns Wayside Gardens in Hodges, S.C. "For us, Jackson & Perkins is a one-of-a-kind brand," said Chas Fox, who will become the company's new president on closing. "There's not another like it out there. It was an opportunity that probably wouldn't come down the pike again. Since November, we've gone through a tremendous amount of due diligence and data to see the value of the company and its potential. It's the most recognizable brand in the horticulture industry. We're excited to be involved. We saw it as an ideal opportunity and the more we looked into it, the more it made sense." Conversely, the rose business no longer fit with Harry & David's overall plan, company officials said, and the cash infusion will enhance the company's balance sheet should owner Wasserstein & Co. decide to resurrect its initial public offering. "In private equity, you're always evaluating your options," Williams said. "It's an ongoing process. This gives Harry & David a cleaner description conceptually and strategically." Formerly known as Bear Creek Corp., Harry & David has gone through a succession of publicly traded owners since the 1980s, beginning with RJ Reynolds. The company forayed in several directions under different owners. RJ Reynolds Corp. acquired Bear Creek in January 1984 in a leveraged buyout totaling $74.1 million. Shaklee Corp. bought Bear Creek for $123 million in 1986, then was consumed by global giant Yamanouchi Pharmaceutical in 1989. "Yamanouchi had no debt and was publicly held and Shaklee had little debt and was publicly held. We're a leveraged company and this strengthens the capital position," Williams said. "Our financial structure is much more like it was when the Holmes family operated the company and it was privately owned. Both (Holmes and Wasserstein) go to banks and other financial markets to fund the business." Jackson & Perkins produced about $74 million in sales during the past 12 months, roughly 12 percent of Harry & David's revenue of $600 million in that period. Williams said about $33 million of the Jackson & Perkins sales were produced in Wasco and the remainder in Medford. Williams said some existing Jackson & Perkins employees will move on with the new ownership, others will take Harry & David positions and still others will leave the company, desiring to stay in the gardening industry. "Where the Jackson & Perkins impact will come for us is in the spring of 2009," Williams said. "By that time, Harry & David will have grown to absorb that loss." A key element for Jackson & Perkins employees working in Medford and the new owners are the transitional services contracted to Harry & David. The company will provide wholesale operational services through 2007 and direct marketing operational work and other services through June 2008. Fox, founder and president of Southern Sun, which he sold to the Hachenbergers, plans to visit with Jackson & Perkins in the near future. "It's not like they hand us the keys to the car and we drive away," Fox said. "There will be a lot of time to pull it over to where it's being wholly run by us." Williams, who presently also has the title of Jackson & Perkins president, said the Harry & David Holdings board began exploring sale of the rose unit last summer and hired WR Hambrecht + Co. of San Francisco to find a buyer. The Hachenbergers were identified as likely buyers in February. "We had one of the best standing brands," he said. "We wanted to realize full value." Reach reporter Greg Stiles at 776-4463 or e-mail [email protected] . Would you like to respond to this story? If so Click Here to visit our forums. Advertisement Copyright © 1997-2007 Mail Tribune, Inc. All rights reserved. Privacy Policy | Terms & Conditions | Website Feedback online casinos news Home Security Systems Online Casino Reviews Trunks, Footlocker Fundraisers UK Homeowner Loans Casinos Canada Cord Blood Banking Discount Hotel Reservations Texas Electric Choice Compare Electric rates in Texas Online Casino Windermere Van Vleet Men's Clothing Debt Help New Hampshire Primary