NEW YORK — The bids are in for bankrupt Burlington Industries Inc., and lead creditor Wilbur L. Ross is among the players.
Ross, chairman and chief executive officer of New York-based investment group W.L. Ross & Co, confirmed Monday that his firm had placed a bid for certain assets of the Greensboro, N.C.-based mill at the 4 p.m. Friday deadline. Ross declined to say how much he had bid or offer other details.
“I’m bound by confidentiality to Burlington,” he said, referring to the agreements that bidders typically must sign to get due-diligence information on bankrupt companies.
Burlington confirmed in a statement it had received “several proposals.” Officials declined to disclose the identities of any of the other bidders.
Ross made his disclosure after Calhoun, Ga.-based carpet maker Mohawk Industries Inc. said it had reached an agreement with his firm to buy the Burlington’s Lees Carpet division.
Mohawk officials did not return calls seeking further comment.
Lees Carpet is seen by observers as the jewel in the Burlington portfolio. In the fiscal year ended Sept. 28, it brought in 26 percent of Burlington’s $1.01 billion in revenue and generated pretax earnings of $36.8 million while the company as a whole recorded a loss.
When Warren Buffett’s investment firm Berkshire Hathaway in February made its $579 million bid for Burlington, sources speculated that his main interest was the Lees division, which would have complemented his Shaw Industries carpet firm. As reported, Buffett pulled his bid after the Delaware bankruptcy court hearing the case struck down some provisions of the deal.
At the time, Ross, who heads Burlington’s committee of unsecured creditors, said he was pleased by the development and had considered the bid too low.
In Burlington’s apparel textile portfolio, the asset seen as most desirable is its Mexican denim mill. Industry sources said Cone Mills Corp. might be interested in bidding for that mill, and is likely working with Ross.
As reported, early this year Ross’ firm agreed to arrange a $27 million convertible financing deal with Cone intended to help it expand in Mexico by building a mill there. That plan was later scrapped, which led to speculation that the mill, also of Greensboro, was interested in buying the Burlington facility.Cone officials have declined to comment on whether they’re interested in Burlington’s Mexican assets, and could not be reached for further comment Monday.
Sources have also said that Santista Têxtil, of São Paulo, Brazil, has looked over the Mexican facility and considered a bid. Santista officials could not be reached.
The auction for Burlington is scheduled for Monday. In its statement, Burlington said it “is assessing the proposals.” Company officials have said they expect to reveal the winning bidder by the end of the month.
Separately, a hearing has been set for July 31 on shareholder Walker Rucker’s call for an investigation into the way Burlington and its executives have handled its assets since the bankruptcy. In a Monday interview, Rucker, a Greensboro real estate magnate, said, “What has happened in the last five to 10 years is the owners of the business have been impoverished and the management of these businesses have taken our money to the bank, and none of them have suffered as the shareholders have.”
Burlington has said its shareholders will likely recover nothing when the mill emerges from Chapter 11.
Rucker said he holds between 4 million and 5 million shares in the company, which would give him a stake of about 8 percent. He acknowledged that he bought most of those shares after the November 2001 bankruptcy filing, at prices from 4 cents to $1.70. Burlington’s shares, which trade over the counter, closed Monday unchanged at 2.5 cents.
Rucker said he suspects the company might have mishandled the stock of Nano-Tex, an Emeryville, Calif.-based operation that develops and licenses nanotechnology enhancements for fabric. Burlington owns a majority stake in the firm, which was not part of the Chapter 11 filing, and Rucker said he believed the remaining shares might be owned by Burlington executives.
“It is our contention that it all ought to be owned by Burlington,” he said, adding that he believed “all of the cost of perfecting Nano-Tex was borne by Burlington.”
A Burlington spokeswoman described Rucker’s statements as part of a “harassment campaign.”
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)
@heriethpaul and @gracebol have a moment on the @victoriassecret fashion show 2017. See every look from the runway on WWD.com. Link in bio. (📷: @giovanni_giannoni_photo) #wwdfashion #victoriassecret #VSFashionShow
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia