Friedman's jewelry company emerges from bankruptcy

<p>Less than a year after filing for bankruptcy, jewelry retailer Friedman's Inc. has emerged from Chapter 11 proceedings.</p><p>The Savannah-based retailer filed for bankruptcy on Jan. 14, after the Securities and Exchange Commission levied charges of fraud. The company had also announced it would have to restate earnings from 2000 through the first three quarters of 2003 because of accounting issues that involved estimates for bad debt.</p><p>The company settled the SEC charge in late November by agreeing to pay $2 million to a fund aimed at preventing fraud. It also replaced all its senior management.</p><p>As part of the court-approved reorganization plan, the jeweler canceled its outstanding common stock, which eliminates any control over the company by those stockholders.</p><p>Friedman's has now emerged as a private company that is owned in part by Harbert Management Corp., which invests in struggling businesses.</p><p>Much of Friedman's $149 million debt was eliminated or refinanced by CIT Group, which approved the jeweler with $125 million in financing.</p><p>The company said earlier this month it would close 51 of its 424 stores after the Christmas season.</p><p>Friedman's, which trails only industry leaders Zale Corp. and Signet Group in size, was started in 1920 and was family owned until 1990, when it was bought by Morgan Schiff, which also owns Crescent Jewelers of Oakland, Calif.</p><p>___</p><p>HASH(0x1cd9d5c)</p>