X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

FORT LAUDERDALE, FL-Financially-fading retailer Gerald Stevens Inc. is operating on borrowed time, but at least the country’s largest flower store chain is still in business, company officers argue.

The company’s strategy in selling $7 million worth of non-core assets is keeping it alive. The sale comprised four real estate properties, a credit card clearing house and an Internet business for florists. The company’s fiscal problems are attributed to a speedy expansion program that saw Gerald Stevens acquire 300 national flower shops in 18 months.

Bank of America is giving the locally-based retailer a new $7-million line of credit through February and, along with other lenders, is extending total debt payments of $16 million to June 2002 from February and May 2001. Top company managers also are loaning the company $1 million in working capital. Gerald Stevens’ management team includes Steve Berrard and Gerald Geddis, former executives at Blockbuster Entertainment.

To get the new credit line, Gerald Stevens agreed to a higher loan interest rate; pay a $1.8 million fee; sign new and amended loan contracts; and put up additional collateral. The company’s original $40-million line of credit was signed in June 1999.

In a move to boost its stock price on the Nasdaq exchange, Gerald Stevens is doing a five-for-one reverse stock split to attract a broader range of investors. The split has a record date of Nov. 14 and an effective date of Nov. 28. After the split, the company will have about 9.8 million shares, down from about 49 million shares earlier this week.

The company’s stock is trading around 94 cents per share. The stock dropped to 37 cents per share in mid-October. It traded in the $13 range a year ago.

Company president John Hall is confident Gerald Stevens will be turned around during the industry’s peak period running from Thanksgiving this month through Mother’s Day in May.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper

GlobeSt. NET LEASE Fall 2021Event

This conference brings together the industry's most influential & knowledgeable real estate executives from the net lease sector.

Get More Information
 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.