Ex-Fingerhut Exec to Buy Assets
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EDEN PRAIRIE, Minn. (AP) _ The former owner of Fingerhut Cos. and a business partner say they’re buying a portion of the catalog retailer from Federated Department Stores Inc., in a deal that may save thousands of jobs in Minnesota.
Ted Deikel, who led Fingerhut from 1990 and oversaw its sale to Federated in 1999, and business partner Tom Petters said they will buy real estate, inventory and other Fingerhut assets. They declined to say how much they were paying.
Federated in January said it would close Fingerhut, which has been losing money, unless it could find a buyer. It gave slim chances for finding a buyer and took steps to close Fingerhut, including laying off about half of its 6,000 workers and halting the printing of new catalogs and taking of orders.
Deikel and Petters said Federated agreed, under their deal, to stop taking such steps.
Deikel and Petters described the deal as tentative. But it resurrects job hopes for thousands of Fingerhut workers.
Fingerhut in January employed about 6,000 people, including 4,700 in Minnesota. Today, it employs 3,100, 2,600 in Minnesota.
Deikel and Petters said they plan to rehire some Fingerhut employees but haven’t determined a precise number.
Deikel led Fingerhut from 1974 to 1984 and again from 1990 to 1999. When Cincinnati-based Federated bought Fingerhut for $1.7 billion in 1999, Deikel’s holdings in Fingerhut were worth about $80 million.
Shortly after Federated’s Jan. 16 announcement that it planned to close or sell Fingerhut, Deikel and Petters expressed interest in acquiring at least part of it.
Their efforts were halted in late February when Federated began exclusive negotiations with Peter Lytle, another Twin Cities businessman. But Lytle was unable to come up with financing to purchase Fingerhut in its entirety.