The operator of United Home furnishings Industries, which abruptly fired all of its 2,700 workers throughout a single evening last thirty day period, has been quietly helping a wind-down of the organization — with some insiders declaring he’s seeking to “save face” subsequent the bloodbath, The Publish has discovered.
David Belford — a wealthy Ohio businessman who experienced long gone silent for several months pursuing the Nov. 21 layoffs at home furniture factories in Mississippi, North Carolina and California — resurfaced before this thirty day period, telling a neighborhood business publication he is “devastated by the convert of events” and calling the problem “agonizing.”
But Belford also insisted he’s not to blame, in accordance to the Dec. 12 interview with Columbus Business Initial. He called himself a “passive investor” in the Okolona, Miss out on.-centered business enterprise, in accordance to the report, including that “my perception into the company’s funds was restricted.”
“Only pretty recently did I discover just how dire the problem experienced grow to be, how limited the company’s alternatives had been,” he claimed. “Unfortunately, the actuality of UFI’s instances was introduced to the board’s awareness considerably far too late.”
However, sources say Belford has quietly taken an lively part in the liquidation, rehiring a handful of employees like the previous fiscal controller, Kim Harper. A previous human sources govt, Helen Benefield, has been tapped to assistance staff members recuperate belongings from shuttered facilities and to reassure them they will obtain W2 statements, sources mentioned.
“He rehired Harper and Benefield and others to help you save face since he was receiving hammered,” reported Philip Hearn, an legal professional who is suing UFI on behalf of workers. “Who seems like a greater Scrooge than this man?”
Belford did not return phone calls for remark.
UFI’s creditors including Wells Fargo are spearheading the bulk of the shutdown, returning trucks and gear to suppliers and shelling out for protection to safeguard these belongings, resources stated. A spokesperson for Wells Fargo declined to remark. UFI suppliers, in the meantime, say they ended up blindsided by the sudden shutdown and stumped by Belford’s explanation that he was out of the loop.
“I just cannot consider having a business as large as UFI and not know what is going on,” said Keith Sechrest, co-operator of Seagrove Lumber LLC, which was compelled to lay off its 45 employees soon after the extensive the vast majority of its organization went absent when UFI shuttered.
UFI experienced fallen at the rear of on its payments to North Carolina-primarily based Seagrove this calendar year, but “there was no warning” that it would basically fold, Sechrest reported. His brother also owns a lumber company that was pressured to shut down and lay off 30 employees.
UFI owes Seagrove $1.2 million in unpaid invoices around the earlier 90 days, Sechrest claims, and owes his brother’s organization half a million pounds. A small blade-sharpening business enterprise that labored with both of those lumber providers is also on the verge of closing, taking an additional four positions with it, he said.
It’s not apparent no matter whether UFI will file for personal bankruptcy. Resources said UFI’s board — whose chairman is even now Belford, according to the Ohio Organization Journal — has just lately retained distressed-debt attorney Mark Melickian, a Chicago-based mostly associate at Sugar Felsenthal Grais & Helsinger, who did not react to requests for remark. UFI also has hired work litigation lawyer Michael Kelly, a lover at Squire Patton Boggs in San Francisco, who declined to comment.
“The owner might imagine it is also high-priced to file for bankruptcy safety and the bank would adore to provide it as a turnkey operation,” claimed Kenneth Rosen, a distressed-personal debt attorney at Lowenstein Sandler who is not involved in the situation.
Suppliers and sellers had been advised lately that business enterprise was increasing and that there was no inkling the firm was in the “dire” condition Belford promises. Even though desire for household furniture has slowed as curiosity prices and inflation rose, UFI has traditionally executed properly through recessions, since its merchandise are worth-oriented, a former executive instructed The Write-up.
“There is no explanation this corporation should really be in the place it is in,” wrote UFI’s longtime president, Larry George, in a Fb write-up on Nov. 29. George left the enterprise practically two decades back and mentioned he would have “stayed on” had he recognised it would shut, incorporating that he “would have managed this in a completely unique method.”
George declined to comment for this tale.
“How could anyone who owns a vast majority of the firm not know the economical circumstance,” a previous supervisor at the North Carolina operations informed The Put up, incorporating that as just lately as Oct, a senior executive visited the vegetation she managed and confident her that “things had been shifting in the ideal route.”
Some workers have signed on to lawsuits alleging that UFI violated labor legal guidelines by firing them without having 60 days’ discover. UFI sent out texts and email messages to staff telling them not to arrive to function on Nov. 21 since their positions and overall health insurance policies experienced been eradicated, efficient immediately.
A new Warn discover was despatched to workers two months ago in which UFI disclosed for the very first time that it was not able “to get ample funding to maintain operations” and that the enterprise was “trying quite hard” to get this financing.
“It’s unhappy that he is comprehensive of it and will take no blame for any of this,” a previous UFI staff stated of Belford on a Fb web site for laid-off staff who are exchanging facts about well being insurance plan, utility aid plans and other companies.
“That’s bull-s–t,” wrote a different ex-employee, responding to Belford’s claims that he was blindsided by a downturn in the company. “David came down within the final 6 months. So he could of gave us more warning. As a substitute [the] CEO kept telling us company was increasing.”
