Less than one week after exiting the banking business, Minnesota’s Pohlad family is entering the world of consumer electronics.
The family’s main investment arm earlier this week closed a $70 million deal to acquire majority ownership of Polaroid and the right to license its still marketable name to manufacturers across the globe.
Polaroid was once part of the corporate world of Tom Petters, the former Wayzata businessman whose businesses collapsed under the weight of a $3.65 billion Ponzi scheme that landed Petters in prison for 50 years.
The company, now based in Minnetonka, filed for bankruptcy protection in 2008 after Petters’ problems exploded.
“We are doing this for three reasons,” Jann Ozzello Wilcox, chief investment officer of Pohlad-owned Marquette Companies, said in a statement to the Star Tribune.
“First, we continue to seek good, strategic growth opportunities; second, we see Polaroid as an iconic brand with a licensing model that’s working, and third, it’s a local company with a solid management team,” Wilcox said.
Although the bulk of the company’s assets were sold to private investors in 2009, the Polaroid bankruptcy estate, led by trustee John Stoebner, still had a partial ownership stake in the 77-year-old company.
Last week Chief U.S. Bankruptcy Judge Gregory Kishel approved Stoebner’s request to sell that portion to Marquette Companies and an undisclosed business partner.
The Pohlad group also acquired ownership interest from previous investors in Polaroid to gain control of about 65 percent of the company. The transaction closed on Monday.
“It’s been a profitable business,” Stoebner said. “It’s locally managed and locally run.”
In a statement, Polaroid CEO Scott Hardy said, “This will bring stable family capital to the Polaroid brand over the long-term. This sale will be the next step in the ongoing resurgence of our iconic American brand and we are very excited about what it means for Polaroid in 2015 and beyond.”
The Polaroid name can be found on a variety of consumer electronic goods ranging from tablets to cameras and flat-screen TVs.
Its marketing partners include niche retailer Urban Outfitters as well as big-box electronics stores.
“Polaroid has maintained an incredibly cool, retro feel to the brand,” said Kevin DiLorenzo, director of brand strategy for the Minneapolis ad agency Barrie D’Rozario DiLorenzo.
“They’ve done a nice job keeping themselves relevant with the next generation, but the challenge is retaining that relevancy going forward.”
The Minnetonka office, which markets the Polaroid name through licensing fees for the brand name and other intellectual property, has fewer than 25 employees. Ironically, it is located near the one-time headquarters of Petters Group Worldwide.
Polaroid was founded in 1937 in Cambridge, Mass., by inventor Edwin Land and shook up the camera world in 1948 with the first instant camera.
The company now markets a whole range of cameras and other electronic goods.
“Polaroid has done a good job reinvigorating its brand but it still has formidable competition,” said DiLorenzo.
The Pohlads, one of the four wealthiest families in Minnesota, are best known for their ownership of the Twins baseball team, but the family operation also has interests ranging from commercial real estate to auto dealerships.
Earlier this month, Pohlad-owned Marquette Financial Companies sold a 14-bank financial group located mainly in Dallas and Phoenix for $182.5 million.
The $70 million purchase price for Polaroid includes the assumption of $18 million in debt and other liabilities.
The Polaroid bankruptcy estate will collect $9.9 million for its debtors.
“We are pleased to partner with other investors — some new, and some existing — that bring additional expertise beyond our own,” Wilcox said.