A White Knight Saves the Day

A white knight, dashing into Pennsylvania's cabinet-making heartland in the guise of a major appliance manufacturer, has stepped up big time in an effort to rescue three of the kitchen/bath industry's most revered custom cabinet brands, and avert what could have been a genuine industry tragedy.

The white knight, of course, is Viking Range Corp., the premium appliance manufacturing company whose CEO, thankfully, hasn't forgotten either his cabinet industry roots or his understanding of the unique role that certain cabinet lines play in defining this market.

The cabinet brands are those of Rutt, Heritage and St. Charles all of which once epitomized a custom cabinet market that, in recent weeks, has seemed threatened with serious erosion.

The tragedy, as much of the industry is aware of by now, would have seen nearly 600 jobs eliminated and all three cabinet brands dashed in one fell swoop by a parent that chose to make a cold, numbers-driven decision to pull the plug on the brands apparently without even the slightest notion of what it was destroying in the process.

All this comes as a result of this month's news that Viking has been awarded the assets of Rutt Custom Cabinetry by a Reading, PA bankruptcy court, and that Viking, as of press time, was attempting to acquire the assets of Heritage Custom Kitchens, which has also been producing the St. Charles brand .

Viking's acquisition of Rutt came on the heels of a decision by the investment firm Berwind Financial to abruptly shut down its leveraged holding company, Classic Kitchens LLC thus halting operations at both Rutt and Heritage, Classic's subsidiaries. The decision to send the companies to bankruptcy court reportedly followed a failed attempt by Berwind to obtain the financing it needed to continue operations after an "unexpected" cash crunch crippled Classic Kitchens in January.

The sudden closure of Rutt and Heritage, needless to say, came as a swift kick where it hurts to company employees and customers, who'd been repeatedly assured, only a month earlier, that Classic Kitchens was realigning the two companies in order to strengthen them both. Classic Kitchens, in fact, had gone to great lengths to point out to anyone willing to listen that the two Pennsylvania factories were being reorganized in a move to expand product lines, upgrade quality, achieve greater efficiency and improve both customer service and the reliability of deliveries.

That announcement, it turned out, proved to be little more than a bunch of glib, short-lived puff. Far worse, it proved to be a sad and cruel deception to Rutt/Heritage employees and dealers who were, at first, optimistic and charged, then angered and bewildered when Berwind abruptly reversed its direction.

By comparison, Viking's acquisition decision, if completely consummated, could prove to be a courageous and savvy move that would do nothing short of instantly resuscitating all three cabinet brands, while preserving jobs and helping to stabilize the suddenly shaky businesses of some of the industry's leading dealers. Viking's move, in particular, would be a lifesaver to Rutt flagship dealers, as well as to those dealers with Rutt/Heritage cabinet orders in the pipeline that were suddenly thrust into limbo. Dealers would also be spared the fate of having to swallow the substantial investments they may have made in Rutt/Heritage displays, door samples, computer software and programs.

In contrast to Berwind's handling of the situ-ation, Viking's actions smack of equal parts class, compassion and just plain good business sense.

By acquiring Rutt, Viking whose premium appliances are aimed at high-end consumers also gets to protect its own interests, since it shares a number of key dealers with Rutt'
and Heritage, and already had strategic relationships with both cabinet companies. Interestingly, Viking's founder and CEO, Fred Carl Jr., had a strong connection with Rutt years ago, through his experience as a custom kitchen dealer prior to founding Viking.

That connection, coupled with Carl's commendable sense of customer loyalty and his keen business acumen, were apparently enough to motivate Viking to pull the trigger