Is Bankruptcy A New Haft Measure?
HERBERT HAFT WAS ONCE worth $200 million--but that was before a family feud splintered his empire. Now, the patriarch of the Haft clan is seriously considering filing for bankruptcy protection, say family insiders, maybe as soon as Aug. 15. That's when the Dart Group CEO must cough up $10 million as part of a divorce settlement with ex-wife Gloria.
The couple's 1994 split followed an ugly fight that pitted Gloria, eldest son Robert, and daughter Linda against Herbert and youngest son Ronald. Herbert, who isn't talking, "just doesn't have the money," says Donald Bourassa, who runs the family's Combined Properties, a mall operator.
In June, Haft tried to borrow $12 million from Dart--which includes Trak Auto, Crown Books, and Shoppers Food Warehouse--but Dart's directors turned him down, say people close to the family. Combined is in bankruptcy, cutting off another source of funds. Haft still bags $800,000 a year from Combined and $3 million from Dart. By filing for protection, he would force Gloria onto a long list of unsecured creditors.
Gloria could be in for an even bigger hit. Transactions to kin within a year of bankruptcy must be returned. So Gloria may have to give back the $15.5 million Herbert paid to buy out her interest in the family businesses. Of course, in the Byzantine world of the Hafts, Herbert's bankruptcy threat may be just a bargaining chip.