Wolf Furniture stunned by deal | News, Sports, Jobs
Suffice to say the Wolf Furniture family has been blindsided. “Nobody could have seen this
Suffice to say the Wolf Furniture family has been blindsided.
“Nobody could have seen this coming,” said Doug Wolf, former president and later CEO of Wolf Furniture Co., founded by his great-grandfather, Charles Wolf, and John Fox in downtown Altoona in 1902.
The 17 Wolf Furniture stores and about 500 employees were shut down by Art Van Furniture LLC on March 20.
Art Van had purchased both Wolf Furniture and Levin Furniture of Pittsburgh in 2017.
“When we sold to Art Van, we were selling to a multi-billion dollar organization, a spectacular company with expectations to have your company and employees thriving,” Wolf said. “We never thought in a short period of time it could end up in shambles. This is a classic business story that is very, very wrong.
“Clearly, nobody had this in mind, nobody could have ever seen this coming. It has been difficult to spend your entire life working on something we loved and was our family heritage. The people who are suffering are the employees, customers and vendors who got caught on the wrong side of this thing.”
On March 5, Robert Levin, announced he was coming out of retirement and had reached an agreement to acquire the Pennsylvania and Ohio assets of Levin Furniture and Wolf Furniture through a court restructuring of Art Van Furniture LLC, which was exploring Chapter 11 bankruptcy.
Art Van did file for bankruptcy March 8.
However, two weeks later, Levin learned that Art Van had decided to close all of the Levin Furniture and Wolf Furniture stores immediately, to terminate the employees and not to proceed with the terms of their agreement.
The parent company reported vast reductions in business due to the COVID-19 pandemic and mandatory store closures as rationale for their decision not to continue to operate the business, and to not seek approval of the sale to Levin in bankruptcy court.
“I had a letter of intent, but the deal didn’t get done,” Levin said. “The deal was not consummated. They fired all employees and closed the businesses. My interest is from a humanitarian and business perspective. My hope is to resuscitate it out of bankruptcy.”
In the meantime, Levin is taking several steps.
“I am setting up a fund for employees to help them with health care,” he said. “I hired a law firm in Pittsburgh to follow the bankruptcy proceedings. I am working with an adviser to see if I can figure out a way to get them back up and hire the employees.”
It will be up to the bankruptcy court in Delaware to determine what happens.
“I don’t know what they will do,” Levin said. “It will be a process. There are a lot of creditors involved. A lot of customers had paid for furniture and made deposits. They (customers) will have to deal with Art Van unless someone comes in and buys the business in bankruptcy. There will be a lot of issues. There are a lot of Wolf customers who have deposits or who have paid in full. We will have to wait to see how this plays out. I hope they take care of the customers. They are considered a very important part of creditors. The virus is a daily issue, (and) it will be awhile before there is a resolution to this.”
John Schimminger of Altoona is one of those customers who recently made a purchase at Wolf Furniture.
On March 10, Schimminger purchased a couch and love seat from Wolf Furniture in Altoona for $2,200. It was to be delivered on Friday.
“We work hard for our money, and it matters, especially at a time like this. We don’t have it just to throw around haphazardly,” Schimminger said.
Fortunately, Schimminger contacted his bank, USAA, about the situation and they have credited the full amount back into his bank account while the proceedings continue.
Art Van was a large company with 190 stores in cities such as St. Louis and Chicago.
“We would like to extend our sincere empathy for the extraordinary hardship so many of our customers, employees and communities are facing. Unfortunately, a confluence of factors has left us with no alternative at this time but to take this action and notify you in as orderly a way as we possibly can,” said a statement on the Art Van website.
“We know customers will have questions regarding customer service policies and many other important topics,” said the statement. “Our operational teams are working diligently to finalize and document those details, and we will communicate them to you as soon as possible. We ask for your patience.”
Wolf said his family believed it was good decision to sell to Art Van in 2017.
“Art Van was incredibly well run,” Wolf said. “They were strong, and they promised great growth. They said they would open 19 new Wolf stores. We saw this as a great opportunity to have success that we couldn’t provide. They were one of the most well-run businesses in the industry. They were the icon. Everyone wanted to be like Art Van.”
Back in the late 1980s, Wolf Furniture had 29 stores. Many were small stores in Pennsylvania, Maryland and Virginia, Wolf said. In 2000, Doug Wolf became the eighth president of Wolf Furniture Co.
By 2003, the company volume exceeded $70 million, qualifying Wolf Furniture for a spot in the Top 100 among U.S. home furnishing retailers, according to Wikipedia.
In 2013, longtime Wolf executive Gene Stoltz was promoted to president of Wolf Furniture and Doug Wolf became CEO. In 2015, Wolf Furniture purchased the 73-year-old Maryland-based Gardiners Furniture chain and rebranded the stores Gardiner Wolf.
Doug Wolf said his father, John, who had served as company as chairman and chief executive officer, and his mother, Ann, are paying close attention to what is happening.
“My dad asks me every day how Robert is doing,” Doug Wolf said. “This is big to he and my mother. They are praying for him. He is well aware of the struggles and is praying for his success. His (Levin’s) heart is in this, and I admire him deeply.”
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