Weave Acquired by Sullivan
February 22, 2010,
Decorative fabrics producer Weave Corp. has new owners: John Sullivan, ceo of American Silk Mills; and an outside group of investors.
“Our investors are just investors, I’m president and ceo and the lead investors in the company. We looked at the company as long as a year ago, but it didn’t make sense joining the two companies then. We are in a similar part of the market in terms of customer base, but our styling and products are very different,” he explained.
When the company closed in October, “we saw it as an opportunity and very viable over the long pull, but we also didn’t have a very long period for due diligence,” Sullivan added. “We and others also thought about acquiring pieces.”
The first objective for the new owners, Sullivan emphasized, is to fulfill the company’s obligations to existing customers. “Our first concern is getting all the open orders out and to get our vendors organized.”
Weave no longer has an office here, nor in Hackensack, N.J., but retains the Denver, Pa., manufacturing facility with a much reduced staff, down from 180 employees a decade ago to 35 currently.
Regina Furtek who headed design for the former Weave will head the company’s design activities and Liz Karp continues to head sales, Sullivan said. They both — along with the design team — will eventually be based again here, he added. In addition, Weave has sales agents world-wide as well as in the United States. Jeffrey Harbst continues to head manufacturing at the plant.
Roger Berkley, former Weave owner, will serve as a consultant “and we’re thrilled that Roger is prepared to do this.”
“Our long-term philosophy is to move cautiously, with an eye to design driven business. But the two companies use different yarns and setups but basically they use the same looms,” Sullivan said. The two companies have a different point of view of the upper end of the decorative fabric business.” Weave, he noted, uses different yarns and luxury tapestry warps.
Sullivan, a seventh generation quality fabric scion, traces his roots in the business back to his family’s Italian-based Gerli & Co. which specialized in raw materials and specialty yarns at the beginning, moving later into fabrics. In the 1950s, Gerli acquired American Silk Mills here that was then based in Paterson, N.J. — often called Silk City following World War II.
“I love textiles,” Sullivan emphasized, “and I see the ability for the United States to maintain the business of novelty, quality products. I see both companies expanding beyond each one’s core businesses. I can’t think in the way of producing basic product, we have a point of view at the upper end. We’ve never chased volume (at American Silk) and we’ll not do it with Weave.”
Overall, he said, “I see both companies expanding beyond their cores and gaining market share in a diminishing market.” While both companies will be separate long term, I sense in ’11 or ’12 there will be opportunities for both companies to work together in some manner. Where one or the other could help in some way, we would take advantage of that.”
The new investor group bought the business for $1.9 million, according to court records. The building in Pennsylvania will be leased from PNC Bank for up to 24 months, and the new company has the option to buy the property for $2.9 million.