| 1-800-Flowers to Buy Harry & David |
By MICHAEL J. DE LA MERCED September 2, 2014 7:44 amSeptember 2, 2014 8:04 am
Already one of the biggest providers of flower deliveries, 1-800-Flowers.com now wants to add Royal Riviera pears and Moose Munch snacks to its offerings.
The flower delivery company agreed on Tuesday to buy Harry & David, the purveyor of gift baskets, for $142.5 million in cash.
Under the terms of the deal, 1-800-Flowers would continue to run Harry & David as a subsidiary, with the current management staying on.
The deal comes more than three years after Harry & David filed for bankruptcy, a response to recession-related shopping woes. Since then, the retailer has increased both sales and earnings, with revenue reaching nearly $400 million in its most recently reported fiscal year, the companies said in a statement.
“This announcement is a clear endorsement of the remarkable work that our talented company has put in over the past several years to rebuild the iconic Harry & David brand,” Craig Johnson, Harry & David’s chief executive, said in a statement.
Adding Harry & David will push 1-800-Flowers’ annual revenue to more than $1 billion, while also leading to potential cost savings at the two companies.
Financing for the deal will be provided by JPMorgan Chase and Wells Fargo.
1-800-Flowers relied on advice from Wells Fargo and the law firm Cahill Gordon & Reindel. Harry & David used Centerview Partners, Piper Jaffray and the law firm Jones Day as advisers.