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Restoration Hardware Reorganizes
August 14,
2012 by in UnCategorized 
By Home Furnishings Business in Business Strategy on August 15, 2012
Home furnishings retailer Restoration Hardware has announced a reorganization of the company.
The purpose of the reorganization is to create a vehicle to incubate new lines of business to support the companys future growth, while enhancing the predictability and focus of its existing business model. Under the new structure, Restoration Hardware will maintain all existing home businesses, while a new corporation will be created to develop new lines of business, including apparel, accessories, footwear and jewelry, many of which will be complementary to the companys new product development strategy. Restoration Hardware, at its sole option, will have the exclusive right to acquire each of the new businesses when they reach an appropriate level of maturity and profitability.
In order to execute this plan, the company will reorganize its leadership team. Gary Friedman, the current chairman and co-CEO of Restoration Hardware, will become the founder, chairman, and CEO of Hierarchy, the newly created company. Friedman will control Hierarchy, with Restoration Hardware owning a minority stake. He will continue to be involved with Restoration Hardware in an exclusive advisory role, serving as creator and curator for Restoration Hardware with a focus on strategy, creative, and design direction. Friedman will remain the largest individual shareholder of Restoration Hardware and will serve as a non-director advisor to the board in his role as chairman emeritus. Carlos Alberini, Co-CEO of Restoration Hardware, will become Restoration Hardwares sole CEO and will lead all major functions of the business. Since joining the Company in 2010, Alberini has played a major role in transforming the Company into a leading luxury brand.
J. Michael Chu, a managing partner of Catterton Partners, will assume the role of chairman of the board of Restoration Hardware.
We are very excited about todays announcement, as it represents yet another significant milestone in the extraordinary transformation of Restoration Hardware," Chu said. "The new structure provides a creative and efficient way to develop new businesses. Gary Friedman, who transformed Restoration Hardware into an admired lifestyle brand in the luxury home market, has demonstrated the ability to re-conceptualize and build some of the most successful brands in the industry, and his continued efforts to drive innovation at Restoration Hardware will be invaluable.
Restoration Hardware is jointly controlled by Catterton Partners and Tower Three Partners. William D. Forrest, Managing Partner of Tower Three Partners, said, We are thrilled with Carloss promotion to CEO of Restoration Hardware. Carlos has made a significant impact on the Companys growth and enhanced performance over the past two years and he will lead a very strong management team. We are confident that Carlos will continue his successful leadership of Restoration Hardware.
Todays announcement supports our goal and belief that we can curate a lifestyle well beyond the four walls of the home," Friedman said. "It allows us to leverage our core capabilities to innovate, curate, and integrate new businesses and develop a brand that transcends typical models existing today. I am proud of the strong brand we have built, excited to pursue this new paradigm and partnership with Carlos, and passionate about imagining and creating a truly special business and brand.
We have a great team of very passionate and committed people," said Alberini. "We have accomplished a lot as an organization and we see big opportunities ahead. I am honored that the Board has entrusted me with this new role and I could not be happier to work with Gary to continue to build this amazing Company together.