Sears and Target Are Among Firms Making Bids To Bu
Kannapolis, NC, Sept. 30--Sears Roebuck & Co. and Target Corp., are among the 11 companies submitting bids to buy some part of bankrupt Pillowtex Corp., a sheet and towel manufacturer.
In filings Monday with the U.S. Bankruptcy Court in Wilmington, DE, the companies said they intend to participate in Thursday's auction of Pillowtex assets.
"The proof is in the pudding, the pudding being the auction," said William Burnett, a lawyer for the committee that represents creditors. "People are just saying, `Hey, look--I'm going to be at the auction.'"
Although Pillowtex is closing its operations, the company's buyer will determine whether any of Pillowtex's plants will reopen and what will become of the company's well-known brands such as Royal Velvet, Cannon and Charisma.
Most of the bids were exclusively for the brand names, which are considered the company's most valuable assets. Only two of the bids were for company equipment or plants, including a former bedding plant in Eden, NC.
Pillowtex announced two months ago it was closing its 16 North American plants and eliminating 7,650 jobs.
The starting bid will be $56 million for the entire company, an offer submitted two months ago by GGST LLC, a liquidation joint venture. But if separate bids for Pillowtex's pieces top that figure, the company could be sold to multiple bidders.
If any Pillowtex plant is to reopen, industry analysts say it will most likely be the company's Fieldale, VA, facility, where Pillowtex made its highest-quality towels.
The auction, in the offices of Pillowtex's New York City lawyers, is closed to the public. Any winning bids must be approved by Judge Peter Walsh at an Oct. 7 hearing.
