Fontenot sees short bankruptcy for WestPoint
June 11, 2003-- Home Textiles Today,
New York — WestPoint Stevens' interim ceo Chip Fontenot said this morning he's hopeful an agreement will be hammered out allowing the mill to emerge from bankruptcy "by the end of the year."
WestPoint "should have filed for bankruptcy two years ago, and we would have saved ourselves a whole lot of grief," Fontenot told HTT. Now working toward a restructuring, "I can guarantee you that we will emerge a very much stronger and very competitive company," he said.
WestPoint had hoped to avert a prolonged bankruptcy restructuring through a streamlined, pre-packaged filing in which creditors agreed to a settlement even before the company goes into court, said Fontenot. And while three big blocs of bondholders had come to terms with the company, a pre-packaged deal was scuttled when bank lenders wouldn't support the plan, he said. "Now they're all negotiating. They know what they want, they're just trying to find common ground."
Effectively running the company for the past two years as president and coo, and now as interim ceo after the ouster of former chairman and ceo Holcombe T. Green Jr., Fontenot emphasized there will be no wholesale plant shutdowns as WestPoint attempts to right its shaky finances. "It's strictly a balance sheet issue. Everything else is working fine. Our plants are extremely efficient, and we have not put together any plan to have massive plant closings. We've already done a lot of restructuring over the past several years. What we will do is what we do normally, and this is to streamline operations. But there are no big plans for massive closings. This bankruptcy is not about the plants; it's a balance sheet issue "
One streamlining coming up, said Fontenot, will be at the company's chain of retail stores. "We have just shy of 60 stores, and we'll be reducing that in the range of 20 percent or so," Fontenot said.
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