Down to business: Bruegger’s, CEO part company

PHOTOGRAPHER: Marlene Kennedy

In the hubbub of the holidays, you could be forgiven for missing this news item: James Greco resigned last week from Le Duff America, a division of the French company that in early 2011 purchased the Bruegger’s bagel chain.

Greco had served as chief executive of Bruegger’s Enterprises Inc. since 2003, when the struggling company was acquired by Sun Capital Partners, and had guided the shops’ subsequent turnaround and expansion.

Last March, Sun — a privateequity firm that buys into businesses it views as latent market leaders, makes changes and then exits them via a sale or public offering — sold Bruegger’s to Groupe Le Duff SA of Rennes, France. In October, Greco was named co-CEO of Le Duff’s new North America division, comprising Bruegger’s, La Madeleine Country French Cafe, Timothy’s Coffees of the World and Brioche Doree, which have restaurants in the U.S. and Canada.

But two months later, Le Duff America announced Greco was leaving “to pursue other opportunities” — a stock phrase that often suggests a less-than-perfect meshing of combined companies. And that’s too bad, given Bruegger’s rocky second half.

The company, you may recall, was founded in Vermont 30 years ago by Nordahl Brue and Michael Dressell, a lawyer and contractor, respectively, who wanted to spread their love of the New York City-style, kettle-boiledthen-baked bagel. They worked for more than two years with a bagel maker to perfect their recipe, added specialty coffee and cream cheeses to create a fastcasual menu, then put the fi rst Bruegger’s Bagel Bakery in Troy in 1983 to test the concept.

A decade of steady growth later, Bruegger’s largest franchisee, Quality Dining Inc. of Indiana, bought out the founders and joined an expansion craze that saw a number of bagel chains jostling for No. 1 — before they all choked on heavy debt and bad real estate deals. Brue and Dressell reclaimed the company less than two years later, closed unprofitable sites and began to rebuild. But it was a slow slog.

Sun, though, saw potential, buying out Brue and Dressell and pumping in new capital. Greco, an attorney by training who proved adept at turning around troubled food companies, was put in charge, and he renovated stores and expanded the menu with wraps and salads. He also acquired a couple of smaller bagel chains, growing Bruegger’s to nearly 300 locations today. In late 2009, Timothy’s, a specialty coffee chain based in Toronto, was added.

When Group Le Duff acquired Bruegger’s last year, Greco said the combination would provide new growth opportunities across North America; when he became co-CEO in the fall, Greco was put in charge of franchising and real estate.

But maybe that was too tame a role for a turnaround guy and Greco chose to go elsewhere. A Bruegger’s spokeswoman, Tracy Aiello, said the company “cannot speak for Jim Greco’s future plans” but that his exit would not be disruptive. (David Austin, Bruegger’s president for 12 years, continues in that role.) Aiello said 2011 saw two Timothy’s Cafes opened in the U.S. — in Boston and at the airport in Cleveland — and the start of franchising by La Madeleine, a bakery-cafe with 60 locations in five southern states. As to brand cross-pollination, she said Bruegger’s now uses ciabatta bread for its paninis from Groupe Le Duff’s wholesale arm, Bridor, and is testing tarts, pastries and croissants from other Groupe Le Duff restaurants.

“Our brands have come together very well … [and] have successfully grown as a result of the partnership,” Aiello said.