HERMAN'S LOSING SUPPLIERS AS RESTRUCTURING BEGINS
Herman's Sporting Goods has retained PaineWebber to raise
$50M for a restructuring, according to this morning's N.Y. POST,
while some "key suppliers" such as Nike have stopped supplying
the retailer with merchandise. The $50M would allow merchant
banks Whitman Heffernan Rhein & Co. and Carl Marks & Co. to cash
out their investments with Herman's. Industry sources say
Reebok, Russell Corp. and Rollerblade have agreed to a $20M
bailout that would allow Herman's to defer payments for a year.
Major suppliers hold 20% of the company's stock as part of a '94
bankruptcy settlement, and they want to help the company survive.
Nike Corporate Credit Manager Tom Cook said they are "as anxious
as any other creditor to work out an agreement" and that they are
still negotiating with Herman's. But Rawlings Sporting Goods is
not shipping to Herman's, and a spokesperson said, "We're just
waiting to see how things shape up." ICON, an exercise equipment
maker, is shipping only on a cash-on-delivery basis. Authentic
Fitness, which owns Speedo, has declined to participate in any
delayed-payment deal (Cynthia Vespereny, N.Y. POST, 2/13).