Posted: 7:01 PM- It started with a threat and ended in a buyout.
On Thursday, Deseret Book officials announced the acquisition of rival Covenant Communications and its sister company Seagull Book and Tape, an LDS-themed retail book chain of 26 stores.
Both Deseret Book, owned by The Church of Jesus Christ of Latter-day Saints, and the Seagull Book brand will continue to operate independently, without cuts to the 250 employees at Covenant and Seagull or to Deseret's 900 workers, said company officials in a joint statement .
"We feel that Deseret Book as a full-service book retailer and Seagull as a well-established discount book retailer, not only both enjoy tremendous brand loyalty, but between them service the LDS market well," said Sheri Dew, president and CEO of Deseret Book Co. "Our strategy is to continue to build both brands."
Acquisition talks began last July after Deseret Book said it would stop selling its popular line of works, written by nearly 140 LDS authors, in Seagull stores because of a difference of opinion in marketing, merchandising and promotional techniques.
The stoppage by Deseret Book could have crushed its smaller, privately held competitor.
"The end result went from head-to-head competition to more of a mutual admiration," said Lew Kofford, founder of Covenant Communications and Seagull Books. "Deseret Book was an ideal choice to make this acquisition, and I fully expect the companies to complement each other."
Neither side disclosed the price of the buyout. But the former rivals said it will be business as usual for all three entities.
Covenant Communications, publisher of LDS products, and Deseret Book's publishing division will continue to operate separately and all existing relationships with authors of both companies will remain intact. Similarly, there are no plans to close any Seagull or Deseret Book stores, and the management team at Seagull and Covenant will remain in place, said Deseret president Dew.
Kofford said he has recently signed a long-term lease with Deseret Book for property headquarters he owns in American Fork, "which is a good indication they'll do what they said they would do."
For his part, the 66-year-old Kofford said he had been looking for "an exit strategy for the past couple of years." He now plans to be a full-time grandfather to his 25 grandchildren.
Covenant Communications is one of the largest publishers of LDS fiction, games, teaching aids, gift books and nonfiction. Seagull Book and Tape is an LDS-oriented discount chain with stores throughout Utah, Idaho, Arizona and California.
Deseret Book, founded in 1866, is Utah's oldest book company, with five divisions: retail, publishing, wholesale, events and direct-to-customer. The retail division operates 43 stores in several states in the Western United States, including Mormon Handicraft, which is a Salt Lake City consignment shop for handmade goods.