After years of strength, Spiegel breaking up

Carole Sloan, May 31, 2004

From its once lofty position as the second largest home textiles catalog a decade ago, Spiegel Catalog is being acquired by Pangea Holdings Ltd. for about $31 million.

Pangea, a Hinsdale, Ill.-based company headed by Christian Feuer, a former vice president of marketing at Spiegel, will acquire substantially all the assets of Spiegel Catalog, including the assumption of certain liabilities. Pangea also will assume all inventory as of the purchase date. At its peak in 1994, Spiegel Catalog had revenues of $1.2 billion.

In the '80s and early '90s, Spiegel was a leader in presentation of home furnishings in its catalogs, one of the few to show room settings and sell all the furnishings pictured. Presen-tation was by lifestyle, and the catalog often took leadership positions in fashion merchandising.

Although not as big as JCPenney in volume, it held a unique position in window coverings fashion direction, often the first with a new treatment or fabrication. Home textiles typically were in excess of 20 percent of the total catalog, with revenues reaching $400 million.

In the '80s, the catalog received the Retailer of the Year award for catalog merchandising from the Home Fashions Product Association.

In January, the company launched a complete redo of the catalog, moving from "a department store in print" approach to a series of businesses and boutiques, and sprinkled with designer expertise in specific areas.

In March 2003, Spiegel Group — parent company of Spiegel Catalog, Newport News and Eddie Bauer — filed for Chapter 11 bankruptcy protection and earlier this month, Pangea won the auction for the Newport News catalog. Closing for Newport News is expected to be this week, while June 15 is the date for court approval on the Spiegel catalog.

The company also has said it would sell its Eddie Bauer retail and catalog business, but no deal has been announced.

Bill Kosturos, interim CEO and chief restructuring officer of The Spiegel Group, said, "This action is an important step as we continue to make progress toward developing a plan of reorganization, while focusing on maximizing the value of the estate for our creditors."

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