WestPoint Home Building Global Platform
In another Big Move, Buys Bahrain-based Bedding Operations
By Don Hogsett -- Home Textiles Today, 8/5/2006 12:00:00 AM
West Point, Ga. — —
West Point, Ga. — Aggressively building a platform for global sourcing, but on its own terms and with total control over the off-shore operation, WestPoint Home has cut a deal to buy the home fashions bedding operations of Manama Textiles Mills in the Persian Gulf nation of Bahrain.
It's the major mill's second big move in the past three months to flex its newfound financial strength, beef up its sourcing operations and cut its product costs. In March, the company formed a joint venture with Indus Dyeing & Manufacturing Co. Ltd., a Pakistani towel producer. That enterprise is expected to be operating at full capacity during the first half of 2007.
In addition to providing low-cost off-shore production, the Manama acquisition provides WestPoint the considerable luxury of knocking off-balance some of its U.S. competition, which had been using Manama for off-shore sourcing.
“Manama Textile Mills has developed a world-class bedding operation that is completely vertical, with state-of-the-art equipment, and is currently an important supplier to WestPoint Home,” said ceo Joseph Pennacchio.
Especially important, he added, Bahrain “provides a low-cost platform that will allow us to compete anywhere in the world,” in part due to the duty-free textiles agreement between the United States and Bahrain.
Not included in the deal is Manama's denim business, which remains under the direction of Manama Mills ceo Hamid Nishat, who said, “We have an excellent relationship with WestPoint Home, and I am pleased to have reached this letter of intent with a company of their caliber for our home textile operations.”
The Manama acquisition is just the latest in a series of steps taken to revitalize and strengthen WestPoint since it emerged from a painful bankruptcy under a new corporate parent, Carl Icahn-controlled American Real Estate Partners. Bankrolled by Icahn, the major mill now has a substantial war chest, giving it a financial cushion recently augmented by a $250 million, five-year revolving line of credit from Bank of America.
And beefing up its management ranks under Pennacchio, WestPoint lured a highly respected executive, Chris Baker, away from rival Springs Industries, where he was responsible for global sourcing, and before that had led the team that managed Springs' key Wal-Mart account. In another recent coup, WestPoint hired industry pro Albert Sardelli to head up the company's design operation.
Putting its best foot forward, and dropping its new calling card, WestPoint has also overhauled its showrooms as it assembles a major product presentation for this week's home fashions market.
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