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Struggling Golden Examining Strategic Options
Judy Quinn -- 8/10/98
With Golden Books' results for the second quarter ended June 27, 1998, showing no signs of a turnaround, the company announced that it has hired Allen &Co. to serve as its financial adviser to help the publisher "evaluate strategic opportunities to enhance shareholder value."
Options that Allen will likely be examining include a major refinancing, a joint venture or the sale of the company. One company that may be interested in acquiring Golden is Tribune Co., whose Landoll subsidiary has done very well in Golden's main area of publishing inexpensive children's books. Scholastic is also considered a possible candidate.

The announcement that Golden had hired Allen &Co. accompanied the release of its second-quarter financials, which saw the company lose $30.6 million in the period, compared to $11.3 million in last year's second quarter. Sales fell to $43.1 million from $50.6 million. For the first half of the year, Golden lost $51.5 million on sales of $89.7 million, compared to a loss of $20.2 million on sales of $116.4 million in the first six months of 1997.

Golden chairman Dick Snyder blamed the weak results on a change in buying practices of Toys `R' Us and a "somewhat soft children's book market." Snyder said Golden has expanded its retail space in both new and existing accounts and that the company is beginning to see new orders since the new planograms have been set. Investors were umimpressed with Snyder's forecast and the stock dropped to a 52-week low of $2.62.
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