May 23, 2002, 12:00 AM

Fingerhut gets another reprieve

A former chief executive and wholesaler are negotiating with Federated to buy Fingerhut. In the meantime, Federated has suspended the liquidation of Fingerhut.


Fingerhut, the division of Federated Department Stores Inc. that was under a death penalty and got a reprieve when a buyer surfaced only to be sentenced to death again when the deal fell through, has gotten another reprieve.

While Fingerhut is not off death row yet, Federated said it has signed a non-binding letter of intent with Thomas J. Petters and Theodore Deikel to purchase “certain Fingerhut assets, subject to the negotiation of a definitive purchase agreement.” Federated did not provide details. Deikel is a former chief executive of Fingerhut and Petters is a wholesaler based in Eden Prarie, MN.

The pair is looking at the distribution center and other facilities in St. Cloud, MN; the subsidiary`s Minnetonka, MN, corporate headquarters; the data center in Plymouth, MN; the distribution center facility in Piney Flats, TN; and the Fingerhut name, web site and inventory, as well as other owned property and equipment.

Federated also said it will halt the liquidation of Fingerhut while negotiations go on.

"This represents clear progress toward our objective of disposing of the Fingerhut business and we are pleased that the buyers have indicated a desire to rehire a number of Fingerhut employees," said Ronald W. Tysoe, Federated`s vice chairman. "Although both parties still must come to terms on a final purchase agreement, we are hopeful that we will be able to do so and Federated is prepared to move as quickly as possible to get this done."


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