[UPDATE: Read Q&Q‘s updated coverage of H.B. Fenn’s restructuring here.]
H.B. Fenn and Company, Canada’s largest book distributor and owner of Key Porter Books, has initiated bankruptcy proceedings. According to a press release sent out this afternoon, the company “today filed a Notice of Intention to Make a Proposal pursuant to the provisions of the Bankruptcy and Insolvency Act.”
According to the release, H.B. Fenn “has encountered significant financial challenges due to the loss of distribution lines, shrinking margins and the significant shift to e-books, all of which have significantly reduced the Company’s revenues.”
We have worked extremely hard to build the Company and keep it going even under today’s adverse conditions,” said founder and CEO Harold Fenn. “My heart goes out to our over 125 employees and to the many publishers we represent, as well as the customers that have supported us over the years.
H.B. Fenn provided Canadian sales and distribution services to nearly 90 publishers and imprints, including publishing giant Macmillan. It was the Canadian distributor for Patrick Taylor’s An Irish Country Courtship (Forge), William P. Young’s The Shack (Windblown Media), Rick Riordan’s Percy Jackson & the Olympians series (Hyperion), Tatiana de Rosnay’s Sarah’s Key (St. Martin’s Press), and Chevy Stevens’s Still Missing (St. Martin’s). It was also the distributor for Vancouver’s Whitecap Books.
H.B. Fenn suffered a major setback two years ago when its largest sales and distribution client, Hachette Book Group, opened a Toronto publicity and marketing office and took over sales for major national accounts including Indigo, Costco, and wholesalers North 49 and BookExpress. (H.B. Fenn continued to handle sales for Hachette’s independent and library accounts.) Hachette also moved fulfillment from Canada to its Indiana warehouse.
A further sign of trouble, H.B. Fenn closed down Key Porter’s Toronto offices last September and laid off the bulk of staff. In early January, Q&Q learned that Key Porter had laid off its remaining editorial staffers and had suspended publishing operations indefinitely.
Still, news of H.B. Fenn’s insolvency will come as a shock to many. The dismantling of Key Porter had seemed like an extreme measure, but it now appears to have been the symptom of much graver underlying malaise.
Meanwhile, the fate of Key Porter’s extensive backlist hangs in the balance.
Keep watching Q&Q for more coverage and analysis.