Lillian Vernon in tentative sale to Taylor Corp.
With one suitor in play, Lillian Vernon plans auction
A company specializing in custom printing prevailed in an auction that was held earlier this week to purchase bankrupt cataloger Lillian Vernon.
Though the sale to North Mankato, MN-based Taylor Corp. must still be approved by US Bankruptcy Court in Wilmington, DE, Michael Muoio, CEO at Lillian Vernon, said he expects the deal to close on April 10.
“People from Taylor are here today and interviewing in terms of who will be offered jobs on Monday,” Muoio said, adding that he's still not sure what his role will be going forward.
The other bidder in the auction was Creative Catalogs Corp., a catalog and online retailer of personalized gift items across several product categories. Lillian Vernon had reached a preliminary agreement to sell the business to Creative Catalogs for a base price of $9.3 million in March.
Muoio insisted the partnership with Taylor is a good one. “The two companies have many synergies, including personalization,” he said.
Taylor Corp. is a holding company which owns several businesses specializing in printing solutions for wedding invitations, business cards, catalogs, stationery and other customized paper goods. The purchase price was not revealed.
Calls to Taylor Corp. for comment were not returned by press time.
Lillian Vernon filed for Chapter 11 protection on February 19 along with several other entities including Lillian Vernon International Inc., LV Catalog Holding Corp., LVC Retail Corp., Everyday Celebrations Inc. and Rue de France Inc.
Lillian Vernon has continued to operate online via debtor financing but isn't currently mailing any catalogs.
The move to seek bankruptcy protection followed a series of step backs for the company, including several staff reductions and other cutbacks and reductions in its catalog circulation.
When Sun Capital acquired Lillian Vernon in 2006, the company's losses were around $22 million, said Muoio, in an earlier interview. Merchandising, overhead and other issues were resolved during the following year, reducing losses to $3.9 million. However, increasing paper, postage and freight costs made it impossible for Lillian Vernon to entirely bounce back from its earlier problems. The current economic situation put additional pressures on the company.