December 31, 1969,
DuPont to cut 4% of work force; polyester, nylon biz affected
Stung by a slowing economy, weakness in the textiles and apparel markets and eroding sales of nylon, polyester and Lycra spandex fiber, DuPont Co. said it will cut its global work force by about 4,000 workers, or four percent of the total.
Hit hard by the textile and apparel slowdown, roughly half the job cuts, about 2,000, will affect DuPont's polyester and nylon business as the company cuts capacity and accelerates the consolidation of those big fibers businesses, according to the company.
In polyester, the company said the polyester filaments business unit will "accelerate the benefits of its manufacturing alliance with Unifi Corp. by shutting down older filaments manufacturing operations and transferring production to lower-cost, more-modern and flexible assets. In addition, other polyester manufacturing operations will be streamlined to assure a sustainable competitive cost position."
In nylon, DuPont said "the apparel segment will continue its previously announced strategy of focusing on differentiated products and modernizing its manufacturing assets. As a result, the company will shut down less competitive production lines." About 75 percent of the affected employees and contractors are in the U. S., DuPont said. The company expects the reductions will generate annual payroll savings of about $400 million on a pre-tax basis.
To cover the cost of severance, asset shutdown and related costs, DuPont said it will take a second-quarter charge against earnings of 40 cents to 45 cents per share.
LVMH to purchase Donna Karan; designer remains director
French luxury goods conglomerate LVMH has cut a deal to buy Donna Karan International for $243 million.
The American designer will remain artistic director and retain control over all creative aspects of the company that bears her name. Karan founded the company in 1984, later taking it public with the sale of stock after she became one of the best-known names in international fashion.
The Donna Karan home line, launched last fall and set to hit the nation's department stores later this year, remains one of the most eagerly awaited home fashions launches in years.
LVMH said it will pay $10.75 a share to acquire Donna Karan, more than one-fourth higher than the $8.50 a share LVMH first proposed to pay when it made an offer for the company last December. The deal is expected to close during the third quarter.
LVMH was formed by the merger of Louis Vuitton and spirits maker Moet Hennessy. Its fashion labels, in addition to Karan, include Christian LaCroix, Emilio Pucci, Fendi, Givenchy and Marc Jacobs. Other products include Louis Vuitton luggage, Dom Perignon champagne, Hennessy cognac, Christian Dior perfume and TAG Heuer watches.
Online retail sales surge; linens/home decor up 37%
Still going strong despite a broad economic slowdown, online retail sales continue to move sharply higher, advancing to $3.4 billion in February, up about 13 percent from $3.0 billion in January, according to the 14th monthly National Retail Federation/Forrester Research Online Retail Index.
Not only were more people buying, they were buying a lot more, since the number of households making online purchases increased just 1.5 percent, to 13.5 million from 13.3 million in January, far slower than the rate of growth in spending. Consumers spent an average of $248 per person in February, compared with $229 in January, up 8.2 percent.
Appliances showed the greatest increase, with sales virtually doubling to $44 million from just $24 million in January. Linens/home decor ranked 10th out of 16 small-ticket categories, posting a gain of 37.0 percent, to $59.8 million from $43.6 million the previous month.
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