This much we know: On Feb. 8, an as-yet-unnamed party made a formal offer to purchase the Fingerhut catalog business from Cincinnati-based parent Federated Department Stores. Federated had announced plans on Jan. 16 to close the Fingerhut catalog unless a buyer was found.
But according to Fingerhut spokesperson Ben Saukko, as many as 12 potential bidders have signed confidentiality agreements. “It’s a big step in saying that you’re interested and actually stepping up and making an offer,” he notes.
To make matters more interesting, former Fingerhut CEO Ted Deikel quit his position on the board of directors at Minnesota HMO Medica to pursue his interest in acquiring Fingerhut. Deikel led Fingerhut from 1974 to 1984 and again from 1990 to 1999. Deikel has been a business partner of wholesaler Tom Petters, who is among those who publicly expressed interest in buying Fingerhut. The Minneapolis “Star Tribune” reports that Deikel declined to discuss who else might be involved with any bid he would make.
Other parties rumored to be interested in Minnetonka, MN-based Fingerhut include private equity firms Texas Pacific—the parent of apparel cataloger/retailer J. Crew—Freeman Spogli & Co., JPMorgan Partners, and Apax Partners.
Meanwhile, on Feb. 11 up to 200 Fingerhut employees and members of the Union of Needletrades, Industrial and Textile Employees (UNITE), which represents 1,500 Fingerhut employees, rallied in Cincinnati to urge Federated to find a buyer for catalog. CATALOG AGE sister publication “Direct” reports that a letter signed by Federated vice chairman Ronald Tysoe was handed out at the protest.
“While expressing appreciation for employees’ hard work, we do not believe that it is likely that we will find [a] buyer,” the letter said. “It has been claimed by some that Federated’s actions in sending out WARN [layoff] notices and discontinuing the mailing of new catalogs reflect Federated’s intent not to sell Fingerhut….Nothing has been done to date that would have a significant negative impact on the business should a sale materialize.”
But UNITE international vice president Noel Beasley told “Direct” that “prior to Jan. 16, [Federated] did everything they did to set the stage for liquidation.”