After Court Approval, Ross Speaks of Plans For Bur
Greensboro, NC, August 2--The man who appears to have gained control of Burlington Industries Inc. on Friday said he expects to invest money building the company and is lobbying for better enforcement of U.S. trade policy, according to the Charlotte Observer.
Wilbur Ross, chief executive of New York City-based WL Ross & Co. LLC, according to the newspaper said he will begin lobbying congressional delegations in textile, steel and farm states on trade issues.
"It is no coincidence that as our trade deficit doubled and redoubled from 1996 to the present, unemployment rose to a 19-year high with 90 percent of the jobs lost coming from manufacturing," said Ross, whose $1.6 billion investment funds specialize in reviving distressed companies.
Ross spoke to reporters at Burlington's headquarters in Greensboro a few hours after making the same remarks to the company's managers, whom he asked for suggestions on how to "restore Burlington to the luster it deserves."
Moments later he confirmed that a bankruptcy judge had approved his $614 million bid for the company. Although another suitor could still submit a higher bid for the company, Ross and Burlington CEO George Henderson said they were confident Ross' bid would prevail.
Burlington solicited bids from 170 potential investors when it put the company up for sale in March, said Henderson.
"There are not a lot of people with $600 million dying to get into the textile industry," Ross said.
Ross' remarks were clearly meant to encourage Burlington's 7,000 employees. Since filing for bankruptcy protection in November 2001, the company has cut employment from 13,500 to 7,000 and shaved its debt by about 40 percent.
The company still employs about 3,000 at six plants in North Carolina. None are in the Charlotte region, where Burlington employed thousands in the 1970s.
"They won't have to go home and answer that question every day, 'do you have a job still?'" said Ross.
Still Ross offered no details on what businesses might be closed or sold, noting he is waiting to hear back from the company's managers.
He said he did not expect to gain control of the company until October, after final approval by creditors and the bankruptcy court.
Ross' bid also must be reviewed by federal antitrust regulators because it calls for selling Burlington's Lees Carpets division to Mohawk Industries of Calhoun, GA, for $352 million. Lees is Burlington's most profitable division, but Ross said the deal will allow him to bring Burlington out of bankruptcy in October as a private company with less than $100 million in debt.
"Other than Lees Carpets, our present thought is to maintain every Burlington business that has realistic prospects for viability," Ross said, reading from the same statement he read to Burlington employees. "We are eager to find ways to improve the businesses and if that takes more capital but seems likely to generate high return, we will invest more capital."
Ross said that one business that caught his eye is Burlington's California based Nano-Tex LLC unit, which is developing textiles that repel water, stains and perspiration.
Ross described Nano-Tex as a small business that could revolutionize the "mature and lumbering" textile industry.
Ross' pledge to lobby Congress on trade issues came just two days after Kannapolis-based Pillowtex said it would close down and lay off 7,650 employees, mostly in the Carolinas, after failing to find a buyer for that company. That raised the loss of U.S. textile and apparel jobs in July to 18,200, or an average of 587 a day, according to the Bureau of Labor Statistics. The industry has complained bitterly in recent years about a flood of Chinese textile imports.
Related Topics:Mohawk Industries