Comings & Goings | Apr 30, 2019 |
It’s official: Robert Allen Duralee has a buyer
Boh staff
By Staff

On Friday, the Robert Allen Duralee bankruptcy saga entered its final chapter. The auction has ended, and the fabric giant has been purchased for a hammer price of $19 million. The buyer? RADG Holdings, an LLC controlled by Tennessee real estate developer Brant Enderle.

Though the sale still requires the approval of a judge, barring any unexpected developments, at a May 2nd hearing, the sale will be confirmed, and ownership of the RAD Group will be transferred. Proceeds will partially go to pay back some of the company’s creditors, including several design centers and licensing partners. Paperwork filed in accordance with the bankruptcy proceedings lists the D&D Building, Decorative Center of Houston, Madcap Cottage, Tilton Fenwick and Laura Kirar among those to be at least partially reimbursed.

Wait, who?

According to paperwork filed with the bankruptcy proceedings, RAD Group has been purchased by an LLC called “RADG Holdings,” which lists Enderle as manager. So who is Brant Enderle? “​I, like most people in Knoxville, have way more questions than answers,” Jesse Fox Mayshark, a longtime local journalist who has covered Enderle’s business dealings, tells Business of Home. “Nobody can figure out what his deal is.”

For the past decade, Enderle has embarked on a series of puzzling real estate investments in Knoxville. In 2016, he and a partner set up an LLC to purchase a struggling mall for $10.1 million, roughly a third of the appraisal price. Some work was completed on the space, but early plans for a complete revitalization were never realized, and the mall has struggled to retain tenants. At one point, the partners behind the investment owed over $600,000 in back taxes (the taxes have since been repaid).

Buying a distressed asset and doing little appears to be a pattern. In 2014, Enderle purchased the campus of the historically black Morristown College, which had fallen into disrepair. At the time, he proposed a redevelopment project to revitalize the site with apartments, an assisted-living facility and a museum honoring the history of the college. Little work was completed, and in 2016 the city purchased the site to turn it into a park.

Enderle appears to have no connection to the fabric or home furnishings industry, though in 2012 he purchased the Standard Knitting Mill, a former textile factory, for $550,000. The site remains undeveloped. Other investments include a brewery that closed in 2017, 900 acres formerly owned by the state power company, and a number of downtown and waterfront buildings. The source of his funding remains unclear. It’s also unknown if Enderle has partners in RADG Holdings, or if he’s acting alone.

How did we get here?

In January 2019, there was a large round of layoffs at Robert Allen Duralee Group—the third since the textile powerhouses Robert Allen and Duralee merged in March 2017. Company leadership characterized the move as a “reduction in force” and an inevitable next step in the two brands’ continued consolidation. “We tailored our studio and marketing department with the idea that going forward there won’t be the duplicative product, or the duplicative effort of making and merchandising it,” CEO Lee Silberman told BOH at the time. Two weeks later, there was another round of cuts.

On February 11, the company filed for Chapter 11 bankruptcy. In a letter to employees obtained by BOH, Silberman wrote that the move would hopefully clear the way for a takeover: “We believe this court-supervised process is the best way to solidify and enhance our financial position. Filing for Chapter 11 provides us with an opportunity to reorganize and look for a company to purchase us so that we have a more stable future.”

Filing for bankruptcy also offered an out for the company’s sizeable debts. The filing included a list of more than 6,000 unsecured creditors, with Valdese Weavers ($2.58 million) and two Chinese companies, Sumec Textile Company and Triplex Shanghai Enterprises ($1.68 million and just under $1 million, respectively) topping the list. The top 30 unsecured creditors alone were owed a combined $12.8 million.

Silberman had been looking for a buyer since last April, when the private equity firm Altamont Capital Partners told him that it would like to sell its majority stake in the business—and tasked him with bringing interested parties to the table. “I’ve been making it very clear that when the deal is done, we will have the capital we need to pay off our vendors, take care of our mill delays, and fix all of our technology problems. And the companies I’m talking to are well aware of that situation and are still interested,” Silberman told top employees in a team meeting in September 2018, where he divulged that he’d been shopping for new ownership.

Want to stay informed? Sign up for our newsletter, which recaps the week’s stories, and get in-depth industry news and analysis each quarter by subscribing to our print magazine. Join BOH Insider for discounts, workshops and access to special events such as the Future of Home conference.