By MARK REITER, BLADE BUSINESS WRITER

MONROE – Clayton Marcus, the last of three furniture units put on the selling block this year by La-Z-Boy Inc., has been sold to Rowe Fine Furniture Inc.

The sale of the upholstered furniture subsidiary was announced yesterday by La-Z-Boy, one of the nation’s largest furniture makers, and Rowe. The purchase price wasn’t disclosed.


Clayton Marcus, a maker of medium to upper-priced upholstered furniture, didn’t fit into the long-term strategy in the operations of the $1.6 billion a year Monroe firm, Kurt Darrow, president and chief executive officer of La-Z-Boy, said in a statement.

The deal follows last week’s announcement of the sale of Pennsylvania House by La-Z-Boy to Universal Furniture, with no disclosed price. Plans to sell the two furniture units and Sam Moore, a manufacturer of upscale upholstered chairs, were made known in February by the company.

Industry analyst Jerry Epperson, of Mann, Armisted, and Epperson, said the furniture subsidiaries involved in the recent sales were minor players in La-Z-Boy operations, producing little revenue for the company’s bottom line.

Clayton Marcus and Pennsylvania House were distractions that took valuable management time that could have been used on other resources, Mr. Epperson said.

La-Z-Boy has been plagued by sagging sales of furniture products at its company owned stores. In July , the company posted a first fiscal quarter loss of $8.7 million, or 17 cents a share, from the same period a year ago.

Sun Capital, a subsidiary of private equity investment firm Sun Capital Partners, acquired Rowe Fine Furniture this year in bankruptcy court. Rowe is headquartered in McLean, Va.

In a statement, Aaron P. Wolfe, vice president of Sun Capital Partners, said the acquisition is part of the strategy to return Rowe to profitability.

Morgan Keegan & Co.’s Laura Champine, another analyst, said money from the sale of Clayton Marcus and any other holdings is a good revenue source for La-Z-Boy to pay dividends to shareholders.

“As far as the amount of the payment, I am guessing that it is not much,” she said. “This will have a small impact on the company as a whole. But, it does generate needed cash.”

John Baugh, an analyst for Stifel Nicolaus & Co., speculated that the deal wouldn’t bring a huge influx of money into the coffers of the furniture company.

“They are really selling the name. There is no plant and no equipment,” he said. “I question how much money La-Z-Boy got from the sale of Pennsylvania House and Clayton Marcus.”

Contact Mark Reiter at:
markreiter@theblade.com
or 419-724-6096.