After running a stock brokerage, investment bank and private equity firm, longtime Orange County money man Walter Cruttenden is heading into something new.
“I am in the linen business,” Cruttenden says with a laugh.
His investment firm, Newport Beach-based Cruttenden Partners, is buying city of Industry-based Strouds Inc., the chain of retail stores selling bedspreads, curtains, pillowcases and other linen products. Cruttenden said the deal should close at the end of the month.
“We got a good price on it,” Cruttenden said, though he declined to talk numbers.
Two months ago, San Diego-based Ihome Inc., an online seller of linens and furniture, offered $38 million for all but six of Strouds’ stores, plus all of its trademarks and copyrights, two distribution centers and the company’s Web site. After the market dropped, Ihome could not find financing for the deal.
“A lot of the employees resigned themselves that it was going to be liquidated. When they got the news, they kind of cheered,” Cruttenden said. The company has 1,300 employees working in 30 full-line and 20 outlet stores. The company has $75 million in inventory and Cruttenden said he expects the stores to pull in a profitable $170 million in sales this year.
Cruttenden will be the chairman of the company and Rob Valone, who was vice president of merchandising, will be elevated to president and run operations. Cruttenden said the company took a downturn after founder Bill Stroud became ill and brought in outside managers. The company opened larger stores in new areas and started carrying other products, such as jewelry and flatware, Cruttenden said. n
