Bacova bolsters bath biz with Burlington
April 15, 2002,
AT THE NEW YORK MARKET Continuing the divestiture of consumer businesses in an effort to restructure its Burlington House division, Burlington Industries sold its bath consumer products assets — including certain inventories and intellectual properties — Friday to Rocky Mount, VA-based space-dyed yarn supplier Ronile.
"The transaction is done, and now we're in the transition stage," Bowers said. "We will begin shipping the products from our Low Moor, VA, facilities. Prior to that, we've made provisions to keep inventories in Burlington's Stokesdale, NC, facility so that there is no interruption in customer service to our retail partners in bath."
Phillip Essig, president and ceo of Ronile, said the merger represents one of many milestones for the company.
Bath is the second business Ronile takes over from Burlington in less than a year. In mid-June Ronile acquired Burlington's area, accent and scatter rug and door mat manufacturer division Bacova and its 374 employees.
"This represents our first step to grow Bacova through acquisition," Essig said. "From the start we viewed Bacova and its successes in the market as a terrific platform on which to build a leading consumer products company. The bath business products are a perfect complement to Bacova decorative rugs and mats."
Under this deal, Ronile is again taking another Burlington veteran, Kathy Fowlkes, who will retain her position as business manager for the bath division.
"I'm very thrilled, and I know it will work out very well," Fowlkes told HTT. "It will be a marriage between the businesses. And for me, it's like going back to where I was."
Prior to the merger, Bacova was producing almost 90 percent of Burlington's bath rugs, all domestically. For the small remainder of its assortment, Burlington was sourcing some special offerings from India.
The bath accessories, most of which are made of ceramic and resin, with some offerings available in wood and metal, come from China, Thailand and India. Embellished shower curtains are sourced from Turkey and India, and the printed varieties are imported from Pakistan and also made domestically. "We will continue to have Burlington represent us as a manufacturer of cloth and fabric for shower curtains," Bowers said.
Bath towel ensembles are all made domestically and start out as either velour or terry blanks and are subsequently embroidered, given a fabric band or given a heat transfer print for design.
"Where possible we will continue to use our domestic assets to produce [our bath products], but we will look globally to enhance the line for design, color, product development and manufacturing," Bowers said. "We feel like the bath business has a strong synergy to our rug business, and we can become more important to our customers and the marketplace if we offer a crossover of products."
Also, as part of the deal, Bacova will retain Burlington's licensing partnerships with artist Sue Zipkin and Gatchel Clarke Designs.
To accommodate the new bath division, Ronile recently leased a 70,000-square-foot space adjacent to its existing 335,000-square-foot facility in Low Moor, VA.
Burlington's bath division currently carries about 250 active skus, or 25 complete collections. The new site is large enough to hold up at least double that volume. "And we hope to do a lot more than that as we grow the business," Bowers said. "This space is big enough for us to grow considerably."
Bacova is also relocating its headquarters from leased offices at Burlington's Greensboro headquarters to a new space in High Point, NC. Bowers, Fowlkes and the rest of the eight-person executives staff is currently moving there.
"We want to take advantage of the High Point market, ultimately," Bowers said.
Burlington, until recent months one of the nation's major home textiles supplier, has been steadily cleaning house of its different domestics businesses. Most recently, aside from its deal with Bacova, Burlington last week signed a definitive agreement to sell its residential upholstery fabrics division to Richloom Fabrics Group (see related story).
Earlier, in March, Burlington and Springs Industries cut a deal — which to date is still being settled in courts — whereby Springs would buy Burlington's former bedding and window businesses.
Remaining under the Burlington House division of Burlington Industries is the decorative converter fabrics and ticking businesses, neither of which is consumer-oriented.