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Edwards Chain Enlists Turnaround Specialist to Save Family Business

Reorganization: Stephen V. Coffey is first outsider to run company in its 70-year history. Creditors may have encouraged the move.

August 25, 2000|LESLIE EARNEST and E. SCOTT RECKARD | TIMES STAFF WRITERS

Edwards Theatres Circuit Inc., a family-operated movie house exhibitor for seven decades, has tapped an outside turnaround specialist to guide the chain through bankruptcy reorganization.

Stephen V. Coffey, 48, who was quietly named president of the Newport Beach company last week, has emerged as Edwards' highest-profile employee, fielding interviews after the company filed for Chapter 11 bankruptcy protection Wednesday.

Chief Executive James Edwards III, who has run the business since his father, James Edwards Sr., died in 1997, has remained behind the scenes.

Coffey was brought aboard as a management consultant in early January. Later that month, he was named chief operating officer.

Installing an outsider in the driver's seat is a sharp departure for Edwards, which has been shepherded by family members throughout its 70-year history. Founder James Edwards Sr.'s daughters, Joan Edwards Randolph and Carole Ann Ruoff, are also company executives.

But these are extraordinary times for Edwards, which is scrambling to save its business after an expansion spree to build large modern theaters left it mired in debt.

The problem has been compounded by the financial drain from older, smaller theaters, which began losing money as moviegoers bypassed them to go to the larger, more comfortable theaters. Edwards has been trying to unload the unprofitable theaters.

Entertainment analyst Kevin Skislock of Laguna Research Partners in Irvine said he believes Edwards' creditors may have had a say in Coffey's selection to oversee the reorganization.

"At times like these the debt owners have their hands on the steering wheel," he said.

Neither Edwards nor Coffey was available for comment Thursday.

Coffey founded Coffey Management Co. in May 1986 to provide owners and chief executives of briskly growing California companies with turnaround and consulting services, according to a biography released Thursday.

From February 1998 to July 1999, Coffey was president of D&L Sheet Metal Inc. in Fullerton, where he completed a "strategic overhaul" of the sheet metal manufacturer, the biography says. Between October 1996 and May 1998, he was chief financial officer and vice president of corporate development for Del-Jen Inc. in Rolling Hills Estates.

The biography made no mention of prior experience in the theater industry.

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