Ross buys Burlington, says debt cut drastically
Susan M. Andrews -- Furniture Today, November 24, 2003
Greensboro, N.C. — One-time textiles giant Burlington Inds. has emerged from bankruptcy and has been acquired by investment firm WL Ross & Co. for about $614 million. Ross immediately sold Burlington's Lees carpet division to Mohawk Inds. for $350 million.
Burlington, carrying massive debt and pummeled by foreign competition, filed for bankruptcy protection in November 2001. Wilbur Ross, chairman of WL Ross and now of Burlington, said the company's debt has been cut from $800 million at the time it entered bankruptcy to $85 million.
Ross also is looking to buy bankrupt Cone Mills for $90 million in a deal expected to close before Dec. 31. He has hinted that some operations of the two textile companies could be merged if the his bid for Cone is successful, but hasn't revealed specifics.
Burlington sold its upholstery fabric business in 2002 to Tietex. The company also sold its consumer home products division, which included finished goods such as top-of-the-bed and window treatments, to Springs Inds.
The Burlington House division continues to make fabric for home products, which it sells to Springs and other customers, as well as contract fabric and mattress ticking. Burlington remains majority owner of Nano-Tex, which specializes in fabric performance technology.
Joseph Gorga, who joined Burlington last year as vice president of North American operations, has been named president and chief executive officer. George Henderson III, who had been chairman and CEO, has left.
Gorga said he will meet with Burlington customers in the coming weeks, and will aim to ramp up quality, reduce costs and build the Burlington brand.
Burlington was once the world's largest textile producer with over 80,000 employees and nearly 150 plants. It currently has about 5,000 employees and nine plants, two in Mexico. The company also has operations in India and a global manufacturing and product development network based in Hong Kong. It operates from its 400,000-square-foot headquarters building in Greensboro, but expects to move to smaller quarters in 2004.
