Colibri Group Closes Without Warning, Blames Economic Conditions

Updated: 1:57 p.m.

William George Shuster, Senior Editor -- JCK Online, 1/15/2009 11:43:00 AM

The Colibri Group, one of the best-known U.S. suppliers of independent and chain jewelers, has abruptly shut down and gone into receivership. (A form of bankruptcy where a receiver is appointed to run a company and recoup as many debts as possible.) The 80-year-old company, based in E. Providence, R.I., was best known to the public for its jewelry and cigarette lighters.

According to its Web site, The Colibri Group sold its products through 20,000 U.S. outlets, including major national chains and independent retailers and has “a broad-based international distribution.”

The shutdown announcement was made in a Jan. 14 evening message by Jim Fleet, chief executive officer, e-mailed to Colibri employees; posted on the wall of the Colibri Group building and also reported Jan. 15 by local media. The closing was so sudden that employees were told that Jan. 14 was their last payday.

In the announcement, Fleet said, “with great regret,” that Colibri “has closed its operations and must seek the protections of filing a petition of receivership with the state of Rhode Island.”

While noting the closing happened “in a rather sudden fashion,” Fleet said “a great deal of serious consideration” went into the action. “The current economic conditions and credit market turmoil are such that Colibri cannot sustain its current operations and as such must close its doors,” he said.

Fleet thanked the “efforts and dedicated service” of the company’s “many loyal, hardworking and talented people.”

The Providence Journal reports that the major shareholder in Colibri, Founders Equity SBIC, a private equity firm, petitioned a Providence court to force The Colibri Group into receivership. Its managing partner, Warren Haber, is chairman of Colibri.

The Colibri Group, founded in 1928 with invention of the world’s first automatic lighter, grew to become a multi-faceted renowned jewelry and accessories company, says its website. It designs, manufactures and markets jewelry, clocks, lighters and accessories under several brands, including Colibri, Seth Thomas, Dolan Bullock and Krementz. It also had license and distribution agreements with several companies, including Disney, Guinness, Nickelodeon and (in November 2008) American Idol. According to its website, The Colibri Group sold its products through 20,000 U.S. outlets, including major national chains and independent retailers and has “a broad-based international distribution.”

Colibri was purchased in 1971 by Frederick N. Levinger and his father, who set up headquarters in Providence, R.I. In 2005, Levinger sold the Colibri Group to a group of three investment firms, who intended to open business opportunities for Colibri overseas. (At the time Levinger sold it, the company had sales of $100 million. Now, the figure is about $32 million, according to published reports.)

Thomas Bendheim, a successful corporate manager and marketer, was appointed president and chief executive officer in 2005 by the new owners. However, he left in 2007 over “differences of opinion on the future direction” of the Colibri Group, the company said then.

Fleet was named to replace Bendhim as president and CEO. Significant investments were made by the company in 2007 to fuel growth and key initiatives, such as a new business-to-business e-commerce Web site. In late 2007 and early 2008, the company relocated from Providence and Cranston, R.I., and consolidated its sales, marketing, and service operations in a single, larger facility in East Providence, R.I.

In July 2008, Colibri Group announced it had completed financing that included an equity investment by the company’s major shareholder, Founders Equity, and simultaneous recapitalization of the company’s bank lines. The transaction was intended to support growth, better serve its customer base and pursue “selective acquisition opportunities.”

One of the company’s last major announcements (in November 2008) was an agreement with FremantleMedia Enterprises (a division of Fremantle, producer of TV’s “American Idol”) to develop and produce a line of “American Idol”-branded men’s and women’s wristwatches, jewelry, accessories, clocks, and cell phone charms. These had been expected to hit the market in January 2009 when the TV show launched its eighth season.