Zelenka 'back to business as usual'

Loren Schofield is thrilled with the news he got Thursday morning: His job, and those of about 800 other Michigan residents, have been secured.

"It's back to business as usual," said a smiling Schofield, the director of human resources for Zelenka Nursery Inc.

The Grand Haven Township-based nursery was bought for $20 million Wednesday by Judkins Nursery, a family-owned company from Tennessee. Bob Berry, Zelenka's new owner, said Wednesday that the nursery's staff would not decrease, but it could grow in the future.

That's good news for more than 1,000 workers who operate Zelenka's three facilities, which are in Michigan, North Carolina and Tennessee. The company's benefits packages and salaries are expected to carry over to the new ownership, Schofield said.

"We believe our payroll, benefits and insurance packages will continue as they are unaffected," he said. "We know that we will keep operating with paychecks rolling in."

The future of the nursery and its employees was tossed into legal limbo when the investment group that had owned the company filed for Chapter 11. Berry's offer helped ensure that Zelenka will continue to operate, even under its old name.

The deal also helped to pay off $17.5 million owed to Zelenka's main lenders, the bank group of Comerica Bank, Standard Federal Bank, Fifth Third Bank and Bank One. More than 300 other unsecured creditors will have to wait longer to receive any money.

According to federal court documents, the unsecured creditors are owed more than $23 million.

"We are hopeful for at least $3.5 million," said Harley Goldstein, an attorney representing the unsecured creditors, such as employees owed back pay and Zelenka's vendors.

Goldstein said it could be months before these groups find out if they get any money because of court proceedings and investigations of other possible Zelenka assets.

According to federal law, employees owed back pay can receive up to $4,650 each, Goldstein said.

Judkins, with a staff of about 200, was bought by Bob Berry and his sons, Brian and Burl, about three years ago.

The family also owns two nurseries, Tri-B Inc. and Parkhill Trees and Shrubs, and a distribution center, Sanders Nursery and Distribution, in Oklahoma. Together, these three companies employ about 850 workers.

Berry founded his first nursery, American Midwest Nursery, in 1961. He even ran Northland Nursery in Grand Haven from 1988 to 1991, after American Midwest bought the company.

All four current Berry-run businesses have total annual sales of about $70 million. After buying Zelenka Wednesday, Judkins officials said they plan to spend $10 million to $15 million more on Zelenka during the winter months.

Zelenka will keep its name and key management, while operating as a subsidiary of Judkins. Despite staying much the same, some things will eventually change.

For example, Zelenka will grow more of its crops in containers instead of in the fields, and seasonal workers who usually finish up around this time of year will stay on for another month to get crops prepared for the winter, Berry said.

Also, every member of the staff will have to go through the application and hiring processes again to make the transition from one owner to another, according to Schofield.

Schofield warned that there might be some glitches in the company's operations during the upcoming transition, but he said the company should be able to handle any unforeseen problems.

"It's not like you can just flip a switch" from one owner to another, he said. "This is a new, legal company that is coming out of an old, legal company.

"We believe whatever arrangements the workers had before will continue ... under the new ownership."