The leadership at Ethan Allen, the furniture and interior design company with deep roots in Vermont, underwent a change this week following a successful shareholder vote to oust three board members. Following a shareholder vote on Wednesday, three of the company’s five board members were ousted in a successful takeover bid led by Doug Bergeron, a Utah-based investor and former Verifone CEO. Among those departing the board is Farooq Kathwari, marking the end of a significant era for the firm.
Founded in 1932, Ethan Allen has served as an “anchor employer” in Vermont’s Northeast Kingdom for decades. Today, the company maintains manufacturing operations across the U.S., Mexico and Honduras, with more than 300 Vermonters employed at facilities in Orleans and Beecher Falls. As VTDigger reported, the company also operates one retail store in Chittenden County.
Modernizing the Legacy Furniture Brand
Doug Bergeron, the founding CEO of DGB Investment, has made his intentions clear: he believes the company has failed to keep pace with competitors in terms of growth. Having won a similar proxy contest at the retail tech firm Canteloupe in 2020, Bergeron is now turning his attention to the furniture sector.
“The existing management team loves (the company), but they don’t know how to love it in a modern way,” Bergeron said.
While the company announced in September that it would seek a new CEO, the board takeover accelerates the transition. The firm has since canceled an earnings call previously scheduled for Monday, Nov. 9, though it still intends to release its quarterly financial reports that day.
The Future of Manufacturing in the Northeast Kingdom
The state’s Commerce and Community Development Secretary, Tayt Brooks, noted that the company remains an “anchor employer” for the region. While the workforce today is smaller than it was in the early 2000s—when it boasted 1,200 staff across the state before a series of layoffs and offshoring—the company’s presence remains vital to the local economy.
Bergeron, who holds a roughly 5% stake in the company, has attempted to assuage fears regarding the future of the Vermont plants. He plans to visit the state next week to meet with employees and tour the Northeast Kingdom facilities. His stated philosophy is that the company’s domestic manufacturing facilities are at an increasing advantage as tariffs make international sourcing more complex and expensive. He maintains that having producers close at hand, both to implement new designs and access customers more directly, is helpful.
“I’m not a private equity firm,” Bergeron said, emphasizing his commitment to the state. “We’re completely committed to the state of Vermont. There will be nothing but growth here. You can’t cut your way to prosperity.”
Cautious Optimism Among Local Leaders
Local business advocates are monitoring the situation with a mixture of concern and hope. Cathy Davis, President and CEO of the Lake Champlain Chamber of Commerce, acknowledged the natural anxiety that comes with corporate upheaval. However, she suggested that the new leadership’s focus on digital retail could be positive for its Vermont manufacturing workers.
This perspective is shared by Loralee Tester, who leads the Northeast Kingdom Chamber of Commerce. She emphasized that for the small communities in the northern part of the state, these manufacturers are the “lifeblood” of the regional economy. The challenges cited by Kathwari in 2021—specifically a “shortage of labor and the escalation of manufacturing costs”—remain the primary hurdles that any new board must address.
Whether Bergeron’s vision for modernizing Ethan Allen’s sales and marketing can reconcile the company’s business goals with the interests of its manufacturing operations remains the central question. As the company prepares to release its quarterly figures, the focus will shift from the drama of the board vote to the concrete financial data that will define the next chapter of this century-old institution.
