Cynthia Passmore, president and CEO of Enesco Group, told company managers she is divorcing her husband and having a personal relationship with a consultant she hired to help the Itasca, Ill.-based gift and accessories company cut costs, according to a report published by Crain's Chicago Business.

An Enesco spokeswoman confirmed to Crain's, the Web report says, that Passmore shared news of the relationship during an employee meeting but wouldn't corroborate details, which were reported Feb. 7 on the publication's Web site. The spokeswoman told Crain's that Enesco's board evaluated the situation and ruled it a non-issue. Passmore joined Enesco as president in October 2004 and was named CEO in January 2005.

Enesco's financial troubles continued through 2005, with a loss of $39 million in the first nine months of the year on $188 million in revenues. After the announcement, the stock price was trading at less than $2, a decline of more than 72% over the past year.

In May, Enesco sold its Precious Moments figurines brand and focused on the kind of gifts and accents that artist Jim Shore designs. It announced plans to reduce its overall product lines from about 170 to 50–60.

The Enesco board's decision to support Passmore closely followed Enesco's settlement with Jim Shore Designs after a six-month legal dispute on the licensing of his products, which are among Enesco's most popular lines and resulted in 2004 sales of more than $30 million. Shore's Heartwood Creek brand products amounted to 13% of the company's revenues that year. The lawsuit and countersuit were settled late last month after Shore agreed to a contract that allows him to end his work for Enesco if the manufacturer has a change in control including, but not limited to, a change in the president/CEO of Enesco.

The Crain's report included Shore's statement supporting Passmore despite changes in her personal life. "As an artist, I want to be confident that my art is represented by a leader who understands the business but who also understands the emotions of it," Shore said. Efforts By Crain's to reach Shore or Passmore were unsuccessful and Enesco board members would not comment. Calls by Home Accents Today to Shore and Enesco also were not returned.