The Oreck family is rallying to take back their namesake vacuum-cleaner company from private equity owners in a deal valued at $22 million—a price that founder David Oreck hints is cheaper than what he sold the business for a decade ago.
Oreck, 89, has never stately publicly how much he profited from the 2003 sale of his company. But while his three sons lead the charge to buy the company’s 96 retail stores and 250-worker manufacturing plant in Tennessee out of bankruptcy, Oreck pointed out that the value of the business has certainly fallen in recent years.
“It obvious that it’s worth less today,” he said. “When I sold the company, it was prosperous, [its profit] was growing and it had virtually no debt, so it was a very healthy company.”
Asked whether his family would be buying it back at a discount, he replied: “It’s not too hard to put that together.”
Oreck Corp. filed for Chapter 11 bankruptcy protection on May 6, saying that the business has struggled against competitors and that sales have declined since 2010. The company has changed hands since the Oreck family sold it in 2003, and it’s now controlled by Black Diamond Commercial Finance LLC.
On Thursday, Oreck executives asked a bankruptcy judge to designate the family’s offer at the lead bid at a July 8 auction, according to papers filed with the U.S. Bankruptcy Court in Nashville, Tenn. Under the proposed sale timeline, other buyers would have until June 28 to put in rival bids.