Gannaway takes reigns at Pillowtex

By Staff -- Home Textiles Today, 3/19/2003 3:25:00 PM

Kannapolis, NC — Amid mounting speculation that textiles giant Pillowtex Corp. is on the block and could soon be sold or split into pieces — perhaps as soon as next month — chairman and ceo David Perdue has jumped ship only 10 months after joining the company from Reebok.

Taking the top spot is Michael Gannaway, who joined Pillowtex only six months ago as president and coo after a career at Sara Lee Corp.

Perdue leaves Pillowtex as doubts continue to swirl about the mill's future as an independent company, speculation that intensified when Gannaway confirmed in a statement that Pillowtex had hired investment banker Credit Suisse First Boston "to evaluate and explore a broad range of strategies," boiler-plate language that usually indicates a company is for sale.

The Perdue defection was not entirely unexpected, since the ceo was widely known to be unhappy in the job and concerned that headhunters had misled him about the company's market position and sales and earnings prospects when he was recruited for the job.

Since he joined Pillowtex, the company successfully emerged from Chapter 11, but only to start losing money once again as it recorded double-digit declines in sales. Moreover, a big chunk of Perdue's compensation was in stock, which is now trading at just $0.26 a share, down more than 97 percent from a 52-week high of $9.15 a share.

Perdue's is just the latest vacancy in the executive suite, following the recent resignation of Scott Shimizu, executive vp and sales and marketing chief, and the ouster last fall of Tony Williams, former president and coo, who had guided the major mill off the shoals of bankruptcy.