Is all this flux typical of the Industry?
From Plant Delights email:
Transitions
NC is losing another of its niche nurseries as Architectural Trees of Bahama closes its doors. Gardeners from across the country traveled to Bahama, NC (near Durham), to choose from the amazing woody plants assembled by owner John Monroe. Due to health concerns, John will be switching his focus from large trees to growing annuals…a decision that shocked us all. In the meantime, John has priced all plants at 50% off, so if you’re looking for some really cool large woody plants, you may want to schedule a final visit.
Our long-time friend and former Asiatica Nursery owner Barry Yinger retired and sold his family farm in Pennsylvania last fall, but retirement didn’t last long. Barry tells us that he was lured back to work by the opportunity to become Executive Director of the Henry Foundation for Botanical Research in Pennsylvania. The Henry Foundation is the 50 acre garden and home of the late botanical explorer, Mary Henry. Although Mary Henry isn’t a household name in the plant world, it should be, for nearly every keen gardener grows plants from Mary’s incredible work.
The Henry Foundation garden has never had much of a public face, although it contains a fascinating plant collection, which I’ve had the pleasure of visiting. We wish Barry well in working toward renovating the gardens and hopefully making them more accessible to the public.
Congratulations also to our friend Fred Spicer, who has taken over as the Executive Vice-President and Director of the Chicago Botanic Gardens. This is Fred’s third garden, following previous stints with the Morris County, NJ, Park System, and more recently as Director of the Birmingham Botanic Garden. Fred replaces Kris Jarantoski, who retired after 40 years at the garden. We’re sure both will enjoy their new adventures!
A recent shock to the nursery industry was the unforeseen bankruptcy of California’s EuroAmerican Growers on January 23. While most folks have never heard the name before, EuroAmerican was one of three nurseries (along with Pleasant View Gardens in New Hampshire and Four Star Greenhouse in Michigan) who form the plant brand Proven Winners. Unless you’ve been living under a very large rock, you’ve heard of Proven Winners. According to our friends involved with the brand, each of the three PW members all signed a contract that if one partner went belly up, shares automatically went to the other partners, so hopefully the PW brand will be able to continue, despite the loss of its West Coast partner.
Fractures within the PW family had been widening for quite a while, but this was more like an Earthquake. The 47-acre modern production facilities just north of San Diego. which included sixteen acres under greenhouse cover, went belly-up when EuroAmerican co-owners Jerry Church (who owned the land) and John Rader (who partnered to start the business in 1992) couldn’t reach an agreement on dissolving their partnership, and the bank demanded its money back. At the time of the bankruptcy, EuroAmerican owed money to 350 creditors with some vendors owed as much as $10 million dollars. At its peak, EuroAmerican had 375 full time employees and estimated annual revenue of $46.7 million.
After being abandoned for several weeks during the initial Chapter 7 bankruptcy proceedings, wholesaler Altman’s plants swooped in and purchased the facilities. You may not have heard of Altman’s either, but if you’ve ever purchased succulent plants from a big box store, you probably have some of Altman’s plants.
Another hit to the PW brand occurred in January when a fire at PW shrub producer Spring Meadow Nurseries, near Grand Haven, Michigan, destroyed their entire office complex. Fortunately, no staff or plant production was affected and the $1 million dollar loss was covered by insurance.
If that wasn’t enough, another large plant wholesaler for the big box stores (Lowes, K-Mart, Home Depot, etc.) declared bankruptcy…again. Zelenka’s had been a popular name in bankruptcy circles several years ago, when it was purchased out of bankruptcy by the Berry Family of Nurseries. The Berry Family of Nurseries (BFN) was then purchased by Insight Equity Holdings in December 2010.
Now the entire 3,577 acre Berry Family of Nurseries including its 1519 employees are going through the Chapter 11 process. Berry’s bankruptcy was blamed on a wet spring, but it sounds to us like the nursery was simply too leveraged…especially with bankruptcy debt of $187 million and annual sales of $135 million dollars. The top 20 unsecured creditors are owed more than $11 million dollars…ouch!
When Insight purchased the Berry Nurseries we wrote about our skepticism, especially after reading the canned statement by Chris Zugaro, a Vice President at Insight Equity, who stated, “We have been investigating the wholesale nursery sector for some time, and are excited about this investment and working with BFN’s industry-leading management team to build long-term value. Insight Equity and BFN are committed to the nursery business and look forward to considering further investments in the space in the future.” I guess Insight would have been better off investing in an Index Fund.
Yet another huge shock to the industry came when Skagit Gardens, a 50 acre liner producer in Washington State with sales of $25 million, went bankrupt. Skagit Gardens was started in 1966 by Jim and Ruth Youngsman, but had been sold in 2008 to Oregon investment firm Aequitas Management LLC.
Unfortunately, Aequitas was recently sued by the Securities and Exchange Commission (SEC) for Ponzi scheme fraud for hiding its deteriorating financial condition from investors, who had invested over $350 million in funds. Top employees had been exiting for over a year, as word of Aequitas’s trouble spread. Mount Vernon, Washington, is already known for a lack of sun, and working under this additional dark cloud was obviously too much.
A bidding war ensued between Gardens Alive and Northwest Horticulture, a neighboring wholesale producer, and was won by Northwest Hort. Northwest Hort is known for growing far less interesting commodity crops than Skagit’s high end specialty niche, so nurseries around the country are holding their breath to see how the new owners change the businesses, which have now been consolidated under the name Skagit Horticulture.
Another industry retirement notice arrived from our friend Scott Kunst, founder of Old House Gardens in Michigan. Scott built an amazing catalog business by focusing on old heirloom bulb cultivars for the last 24 years. In Scott’s case, he has sold the business to his employees, who have just moved into their new headquarters a few miles away. We wish them the best of luck as they continue filling this lovely niche. And to Scott, job well done!
From Plant Delights email:
Transitions
NC is losing another of its niche nurseries as Architectural Trees of Bahama closes its doors. Gardeners from across the country traveled to Bahama, NC (near Durham), to choose from the amazing woody plants assembled by owner John Monroe. Due to health concerns, John will be switching his focus from large trees to growing annuals…a decision that shocked us all. In the meantime, John has priced all plants at 50% off, so if you’re looking for some really cool large woody plants, you may want to schedule a final visit.
Our long-time friend and former Asiatica Nursery owner Barry Yinger retired and sold his family farm in Pennsylvania last fall, but retirement didn’t last long. Barry tells us that he was lured back to work by the opportunity to become Executive Director of the Henry Foundation for Botanical Research in Pennsylvania. The Henry Foundation is the 50 acre garden and home of the late botanical explorer, Mary Henry. Although Mary Henry isn’t a household name in the plant world, it should be, for nearly every keen gardener grows plants from Mary’s incredible work.
The Henry Foundation garden has never had much of a public face, although it contains a fascinating plant collection, which I’ve had the pleasure of visiting. We wish Barry well in working toward renovating the gardens and hopefully making them more accessible to the public.
Congratulations also to our friend Fred Spicer, who has taken over as the Executive Vice-President and Director of the Chicago Botanic Gardens. This is Fred’s third garden, following previous stints with the Morris County, NJ, Park System, and more recently as Director of the Birmingham Botanic Garden. Fred replaces Kris Jarantoski, who retired after 40 years at the garden. We’re sure both will enjoy their new adventures!
A recent shock to the nursery industry was the unforeseen bankruptcy of California’s EuroAmerican Growers on January 23. While most folks have never heard the name before, EuroAmerican was one of three nurseries (along with Pleasant View Gardens in New Hampshire and Four Star Greenhouse in Michigan) who form the plant brand Proven Winners. Unless you’ve been living under a very large rock, you’ve heard of Proven Winners. According to our friends involved with the brand, each of the three PW members all signed a contract that if one partner went belly up, shares automatically went to the other partners, so hopefully the PW brand will be able to continue, despite the loss of its West Coast partner.
Fractures within the PW family had been widening for quite a while, but this was more like an Earthquake. The 47-acre modern production facilities just north of San Diego. which included sixteen acres under greenhouse cover, went belly-up when EuroAmerican co-owners Jerry Church (who owned the land) and John Rader (who partnered to start the business in 1992) couldn’t reach an agreement on dissolving their partnership, and the bank demanded its money back. At the time of the bankruptcy, EuroAmerican owed money to 350 creditors with some vendors owed as much as $10 million dollars. At its peak, EuroAmerican had 375 full time employees and estimated annual revenue of $46.7 million.
After being abandoned for several weeks during the initial Chapter 7 bankruptcy proceedings, wholesaler Altman’s plants swooped in and purchased the facilities. You may not have heard of Altman’s either, but if you’ve ever purchased succulent plants from a big box store, you probably have some of Altman’s plants.
Another hit to the PW brand occurred in January when a fire at PW shrub producer Spring Meadow Nurseries, near Grand Haven, Michigan, destroyed their entire office complex. Fortunately, no staff or plant production was affected and the $1 million dollar loss was covered by insurance.
If that wasn’t enough, another large plant wholesaler for the big box stores (Lowes, K-Mart, Home Depot, etc.) declared bankruptcy…again. Zelenka’s had been a popular name in bankruptcy circles several years ago, when it was purchased out of bankruptcy by the Berry Family of Nurseries. The Berry Family of Nurseries (BFN) was then purchased by Insight Equity Holdings in December 2010.
Now the entire 3,577 acre Berry Family of Nurseries including its 1519 employees are going through the Chapter 11 process. Berry’s bankruptcy was blamed on a wet spring, but it sounds to us like the nursery was simply too leveraged…especially with bankruptcy debt of $187 million and annual sales of $135 million dollars. The top 20 unsecured creditors are owed more than $11 million dollars…ouch!
When Insight purchased the Berry Nurseries we wrote about our skepticism, especially after reading the canned statement by Chris Zugaro, a Vice President at Insight Equity, who stated, “We have been investigating the wholesale nursery sector for some time, and are excited about this investment and working with BFN’s industry-leading management team to build long-term value. Insight Equity and BFN are committed to the nursery business and look forward to considering further investments in the space in the future.” I guess Insight would have been better off investing in an Index Fund.
Yet another huge shock to the industry came when Skagit Gardens, a 50 acre liner producer in Washington State with sales of $25 million, went bankrupt. Skagit Gardens was started in 1966 by Jim and Ruth Youngsman, but had been sold in 2008 to Oregon investment firm Aequitas Management LLC.
Unfortunately, Aequitas was recently sued by the Securities and Exchange Commission (SEC) for Ponzi scheme fraud for hiding its deteriorating financial condition from investors, who had invested over $350 million in funds. Top employees had been exiting for over a year, as word of Aequitas’s trouble spread. Mount Vernon, Washington, is already known for a lack of sun, and working under this additional dark cloud was obviously too much.
A bidding war ensued between Gardens Alive and Northwest Horticulture, a neighboring wholesale producer, and was won by Northwest Hort. Northwest Hort is known for growing far less interesting commodity crops than Skagit’s high end specialty niche, so nurseries around the country are holding their breath to see how the new owners change the businesses, which have now been consolidated under the name Skagit Horticulture.
Another industry retirement notice arrived from our friend Scott Kunst, founder of Old House Gardens in Michigan. Scott built an amazing catalog business by focusing on old heirloom bulb cultivars for the last 24 years. In Scott’s case, he has sold the business to his employees, who have just moved into their new headquarters a few miles away. We wish them the best of luck as they continue filling this lovely niche. And to Scott, job well done!
