Burpee Files for Chapter 11

To answer listeners questions we are including this information Seed company Burpee makes Chapter 11 filing The firm's chairman said some acquisitions had not paid off. Analysts also pointed to failed investments in retailing. By Benjamin Y. Lowe INQUIRER STAFF WRITER After several acquisitions and a stand-alone retail-gardening operation failed to germinate, W. Atlee Burpee & Co.'s parent has filed for Chapter 11 bankruptcy protection. Burpee Holding Co., a garden-seed supplier in Warminster, said the filing did not involve its four operating subsidiaries, which the company said would not be affected. "This is just a credit and financing issue for the holding company," George C. Ball Jr., the company's chairman, said yesterday. Though he would not be specific, Ball said the company's finances had come under pressure from several acquisitions that had not paid off. "It was a question of our banks' patience with our performance," Ball said in explaining the Sept. 21 filing in Bankruptcy Court in Philadelphia. "They became less patient, even as we started to perform better." The catalog company's problems also stemmed from failed investments in a four-store retailing operation, said Stan Pohmer, a seed-industry consultant and president of Pohmer Consulting Group in Minnetonka, Minn. The stores, the 125-year-old company's first retail outlets, opened in 1999 and were closed last spring, said Bridget Wilson, managing editor of Seed World magazine and Greenhouse Product News in Des Plaines, Ill. "They were within the industry but beyond their core competency," Pohmer said. "Going from being a seed producer and publisher of catalogs and magazines, and then going into retail is a whole different thing." Together with NK Lawn and Garden Co. of Chattanooga, Tenn., and Ferry-Morse Seed Co. of Fulton, Ky., Burpee ranks as one of the top three consumer-seed producers nationwide, Pohmer said. Burpee Holding's four subsidiaries had combined 2000 revenue of more than $50 million and employed about 1,400, according to Dun & Bradstreet Inc., the credit-rating firm. With more than $30 million in sales, W. Atlee Burpee & Co. is the biggest and most well-known of the operations. The company's bankruptcy filing lists subsidiaries of the PNC Financial Services Group Inc., of Pittsburgh, as the largest creditors, with $16.6 million owed. Other listed debts include $2.7 million to Medford Center Associates, a Moorestown shopping mall operator, and $1.7 million of acquisition debt to Heronswood Nursery Ltd., of Kingston, Wash. None of the creditors would comment. Burpee's poor performance has had little to do with the slowing economy, said Wilson, the magazine editor. "Everybody knows the economy is not very good, but floriculture has been protected," Wilson said. She said the U.S. market had annual sales of at least $2 billion. "It is still growing at double-digit figures." Ball bought W. Atlee Burpee & Co. in February 1991 for an undisclosed amount. Jonathan Burpee, the founder's grandson, was the last family member to work for the company. He was fired in 1993. Burpee seeds is still open for business and can be accessed through their website at www.burpee.com/ Benjamin Y. Lowe's e-mail address is blowe@phillynews.com. For additional information log on to gardenweb.com forums for Burpee and other bankrupt company information. Larry A. Sagers Regional Horticulturist Utah State University Thanksgiving Point Office