Witex AG Will File Bankruptcy

Kennesaw, GA, May 28--As reported on floordaily.net earlier, Pergo has decided to cancel the acquisition of Witex AG. The merger would have given Pergo a greater share in Witex, although parent firm HW Industries would still be the majority shareholder. Pergo announced its intent to cancel the deal in a press release dated May 20th. As a result of that announcement and the ensuing meetings held with Witex AG's banks, Witex AG is now struggling financially. HW Industries is still interested in a Pergo and Witex AG merger. In the firm's opinion, nothing has happened to change the basic consideration of the whole negotiations that considerable synergies could be gained by concentrating production in Augustdorf and combining the sales networks. Although the main shareholder, HW Industries GmbH & Co KG was willing to help Witex AG in direct proportion to its shares, the firm feels it will have no other alternative than to apply for Chaper 11 in the coming week. This action will be taken only by Witex AG and will not affect the other companies currently held under the HW Industries Group which are in solid financial condition, including Witex USA, Inc. “Witex AG is our sister company and one supplier of laminate products to us,” explained Stephen Newman, President of Witex USA, Inc. “However, we operate independently and do not have any legal connection or liability with them. “This development does not impact our day-to-day business,” he continued. “Witex AG should not experience an interruption in manufacturing as the company goes through the restructuring process. Our existing inventory as well as the supply from our factory in Malaysia will be able to fuel our needs in the interim.”