The southern California developer attempting to purchase troubled Norwalk Furniture Corp. has reportedly pulled out of the deal, leaving the fate of the 106-year-old high-end furniture manufacturer in a precarious state.
More than 200 workers at Norwalk's northwest Ohio factory were sent home Wednesday by company officials.
In a written statement, the company said Dallas-based Comerica Bank "was temporarily unable to fund our operations yesterday based on the present state of the negotiations for the financing plan for the period through closing of the deal between Norwalk and the buyer, IRG/Blackbird Capital Partners. Negotiations continue and we are hopeful for a quick resolution to these negotiations."
The statement said the company has stopped accepting new orders.
"Regardless of the outcome of the negotiations, we are also working with Comerica for immediate funding to be able to produce orders in-house that need no new raw materials and then additionally orders in-house that will need additional new raw materials. We will send payment instructions regarding these orders as soon as we resolve funding the production of these orders."
Stuart Lichter, president of Industrial Realty Group, told the Cleveland Plain Dealer that his company had ended its acquisition effort. He did not return a call to The Blade seeking comment.
Norwalk Furniture Chairman Jim Gerken could not be reached for comment yesterday. However, the company's statement indicated hope that operations at the furniture maker could resume.
"Although we feel confident that the employees will be back at work this week, we will not be accepting orders until we have a credible, funded going-forward plan. We will keep you updated as the situation evolves," the statement said.
The company shut down in July when its financing was pulled. At that time, it had a factory with 500 employees making customized higher-end furniture in Norwalk, plus a 400-employee factory in Fulton, Miss., and an operation in Cookeville, Tenn. It also has a chain of stores selling the products.
- Larry P. Vellequette