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Fabrikant, GIA: A Busy News Weekend
November 20, 2006
A number of things happened this weekend:
-
Fabrikant went chapter 11. Here is what we know: Their assets are $225 million, and debts are $363.9 million. According to
Dow Jones, it owes bank lenders $161.9 million, other creditors $36 million and $124 million to its non-bankrupt subsidiaries. The papers we've obtained list their number one unsecured creditor -- a position Fabrikant has held on a petition or two -- as ABN-Amro, with $13.8 million, and Antwerp Diamond Bank, with $8.84 million.
Even though this was widely expected, it's still kind of a shock. The company's strategy to cope with its mounting problems seens to have been to sell of its various divisions;
India's Tara Jewels bought 75% of Fabrikant-Leer, and its onetime partner
Salant took over its Israeli sightholder divison. It is not clear what will happen to all their
associated companies -- including Robert Lee Morris and Simmons Jewelry Company. (
UPDATE: Robert Lee Morris looks like it was
just sold too.) The fact that its lenders were unwilling to float them through Christmas is, as they say, not a good sign. And with the banks on the hook for so much, it will make them a lot more conservative in their lending. A very bad situation.
- Donna Baker, until now "acting president" of GIA, is now
permanent president. Here is the
backgrounder and interview we did with her when she was first appointed; perhaps the most interesting fact is she spent ten years as a nun. She is also popular internally and people there seem happy with the choice.
- Finally, the Daily News gave their
two cents on the new building on 47th Street (arguing it will "destroy the Diamond District"), and here is another article on "Blood Diamond" and the industry, this time a rather fair one from
Time magazine.
Posted by Rob Bates on November 20, 2006 | Comments (4)
