Harry & David’s rebound leads to deal with 1-800-Flowers
Under the terms of the deal, 1-800-Flowers would continue to run Medford, Ore.-based Harry & David as a subsidiary, with the current management staying on.
The New York Times
Already one of the biggest providers of flower deliveries, 1-800-Flowers.com now wants to add Royal Riviera pears and Moose Munch snacks to its offerings.
The flower-delivery company agreed Tuesday to buy Medford, Ore.-based Harry & David, the purveyor of gift baskets, for $142.5 million in cash.
Under the terms of the deal, 1-800-Flowers would continue to run Harry & David as a subsidiary, with the current management staying on.
Harry & David’s fruit, food and other gifts are housed under brands including Wolferman’s, Cushman’s and its namesake. Products include Harry & David Royal Riviera pears, Tower of Treats gifts, Fruit-of-the-Month Club products, Wolferman’s specialty English muffins and other breakfast products and Cushman’s HoneyBells citrus gifts.
Carle Place, N.Y.-based 1-800-Flowers’ brands already include Fannie May, Cheryl’s and The Popcorn Factory.
“We are extremely pleased to be adding the iconic Harry & David name to our growing family of great gifting brands,” 1-800-Flowers Chief Executive Jim McCann said in a statement.
The deal comes more than three years after Harry & David filed for bankruptcy, a response to recession-related shopping woes. Since then, the retailer has increased both sales and earnings, with revenue reaching nearly $400 million in its most recently reported fiscal year, the companies said in a statement.
“This announcement is a clear endorsement of the remarkable work that our talented company has put in over the past several years to rebuild the iconic Harry & David brand,” Craig Johnson, Harry & David’s chief executive, said in a statement.
Adding Harry & David will push 1-800-Flowers’ annual revenue to more than $1 billion, while also leading to potential cost savings at the two companies.
The transaction is expected to close in October.
Shares of 1-800-Flowers rose 16 percent to close $5.98 a share on Tuesday.
Material from The Associated Press and Los Angeles Times is included in this report.