Brown & Cole announces identity of investor

 

Hancock Park Associates is the California-based investment company in negotiations to take over the majority shareholder status of Brown & Cole Stores LLC, said Brown & Cole president Craig Cole.

The $40 million transaction will bring the company out of Chapter 11 bankruptcy, Brown & Cole president Craig Cole said.

Cole had been unable to reveal the identity of the investment company until now.

Hancock Park Associates is a private-equity investment firm based in Los Angeles. Representatives from the company could not be reached for comment, but according to its Web site, the firm focuses on investing in small- to mid-size manufacturing and retail companies in California and along the West Coast.

The company specializes in operations management. According to Hancock Park Associates Web site. “Each of the firm’s principals has significant operating experience which allows HPA to seek out investments in businesses where present management needs to be supplemented.”

However, Cole said Hancock Park Associates has said Brown & Cole’s management would remain in place. He indicated Brown & Cole headquarters would remain in Bellingham.

“I am working with HPA on a long-term management plan, which will include the normal succession issues. I anticipate a continuing role with the company, but I also don’t expect to remain CEO forever,” he said. “Even grocers get to retire some day.”

Hancock Park Associates’ Web site describes the company as a long-term investor with a focus on building long-term value, which it states is best accomplished by helping to make good businesses fundamentally better and more profitable, not by managing with an eye on a short-term exit.

Founded by Michael J. Fourticq, Sr. in 1986, Hancock Park Associates’ portfolio of businesses includes Gordon Biersch Brewery Restaurant Group, Inc. and Classic Party Rentals, among others.

Cole said the acquisition needs final approval from the U.S. Bankruptcy Court in Seattle as part of Brown & Cole’s reorganization plan, before being finalized.

A disclosure hearing involving the company’s creditors and debtors is set for November and a confirmation hearing is likely to take place in December, which Cole said would hopefully bring Brown and Cole out of Chapter 11.

Brown & Cole filed for Chapter 11 bankruptcy in November 2006. As part of its reorganization plan, the company will continue operating its 20 Washington state grocery stores under the same Cost Cutter and Food Pavilion names.

No layoffs or personnel restructuring are planned as a result of the reorganization, Cole said. The plan will also require curbing employee benefit costs, which will be done by bargaining with the company’s union, he said.

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