Dan River to Sell Engineered Fabrics Division
December 20, 2004,
Slimming down and raising cash as it prepares to exit bankruptcy some time after the first of the year, Dan River Inc. has cut a deal to sell its engineered fabrics division for about $9.4 million in cash.
Dan River acquired the business as part of its earlier buyout of The Bibb Company and that operation's core home fashions business.
The engineered products business is being acquired by Porterdale Acquisition, LLC, a company affiliated with Industrial Specialty Fabrics Inc. and Royal Cord Inc., producers of yarns and fabrics for the rubber goods market. The sale is subject to approval by the U.S. Bankruptcy Court for the Northern District of Georgia, Newnan Division, and the final price is subject to post-closing adjustments.
During the recent third fiscal quarter, the operation recorded sales of $8.4 million, up 23.9 percent from $6.8 million during the same period a year ago. For the nine months year-to-date, the division put up sales of $25.9 million, roughly flat with $25.6 million last year. During the third quarter, the operation recorded a modest operating profit of about $100,000, recovering from a prior-year loss of $1 million.
Bob Major, president of the unit, commented, “This is a very positive development for Dan River's engineered products business and for its customers. A number of parties expressed an interest in acquiring, improving and developing its business.”