Milliken alliance realigns

March 17, 2003

ATTAC changes name, expands, drops union

WASHINGTON, DC — A textile lobbying group co-founded by Roger Milliken last year has dropped the textile and apparel union UNITE and expanded membership to include other manufacturing sectors.

At its first annual meeting of members here this month, the American Textile Trade Action Coalition (ATTAC) also was renamed the American Manufacturing Trade Action Coalition (AMTAC) and a new charter was formally adopted.

The coalition was formed nearly a year ago by Roger Milliken, chairman and CEO of Milliken & Co., and Bruce Raynor, president of the Union of Needle Trades and Industrial Textile Employees (UNITE) — an alliance that turned heads, given Milliken’s longtime anti-union sentiment. George Shuster, CEO of Cranston Print Works, was the third co-founder.

During its annual meeting, the organization parted ways with the union and opened its ranks to include additional industrial sectors such as furniture and chemical producers. As a result, the coalition changed its name to reflect its broader membership and pledged to fight for the preservation of U.S. jobs across the entire domestic manufacturing base.

Under this new formulation, AMTAC will become a manufacturing-only coalition but will continue to coordinate directly with UNITE and other industrial unions on trade issues, it said.

Raynor said that he remains committed to the goals envisioned by AMTAC and, through the Industrial Union Council, he looks forward to working with AMTAC and other U.S. manufacturers who are dedicated to saving U.S. jobs.

“It is absolutely vital that the coalition represent a much greater segment of the U.S. industrial base,” Milliken said in a statement. “It is critical that policy makers understand that U.S. trade policy is severely damaging all segments of U.S. manufacturing.”

A revised trade policy is needed to address the fact that the U.S. has lost more than 2 million manufacturing jobs in the past two years, Milliken added.

The inclusion of non-textile companies will enable AMTAC to broaden its political base and improve the likelihood of advancing a pro-manufacturing trade agenda in Washington.

“The coalition will work to increase awareness of the enormous contribution that the U.S. industrial base makes to our economy, to our national defense and to our communities,” Shuster said. “We are committed to working with U.S. manufacturers from all sectors that are committed to preserving jobs in America.”

In addition, AMTAC members have initiated a Washington agenda that includes:

• extending the current Defense Department buy-American provisions to other national security agencies such as the newly formed Homeland Defense Department;
• using existing safeguard mechanisms to restrain surging imports from low wage suppliers such as China and Vietnam;
• opposing further unilateral trade bills that liberalize the U.S. market such as the extension of duty- and quota-free treatment for imported apparel; and
• increasing public awareness of the devastating consequences of the U.S. trade deficit and the need to take immediate steps to reduce the deficit.

TYAA meets, fetes co-founder

March 17, 2003

By Devin Steele

 
Udo Schweizer of PolySpinTex gives technical talk.

CHARLOTTE, NC — The Textured Yarn Association of America (TYAA) honored one of its own before getting an earful of trade and technical information during its annual Winter Conference here recently.

Norman Cohen, one of the group’s founding fathers, was awarded Honorary Membership in the organization. An Honorary Member is one who has rendered distinguished service to the textured yarn industry or to TYAA.

Cohen, of Charlotte-based Unitec, Inc., founded the association in 1971 with Allen Booth of Duplan Corporation and Bill Rush of Hoechst Fibers. Then with Goulston Technologies, Cohen met with Booth and Rush to lay the foundation for an association that would be dedicated to improving textured yarn technology.

More than 100 members attended the group’s latest get-together, which was keynoted by Hal Weatherman, chief of staff for U.S. House Rep. Sue Myrick (R-NC). An Elkin, NC, native who indicated that he grew up in a textile family, said Myrick represents a district that is torn on the “free trade” issue.

“Half of our district doesn’t want it, the other half wants it, but with provisions,” he said.

To address that broad issue and others that affect textiles specifically, Myrick is an active member of the Congressional Textile Caucus, he added.

“If Southern Congress people don’t stick together, we’re all in trouble,” Weatherman said.

He also touched on several active free trade agreements, including deals involving Chile, Singapore, Vietnam and a Free Trade Area of the Americas.

While Myrick agrees with the Bush Administration on a number of issues, she isn’t in lock-step with the president on the United States’ proposal to eliminate tariffs on textiles and apparel from FTAA countries nor on a similar initiative with the WTO.
TYAA co-founder Norman Cohen (R) is presented a plaque by TYAA President
Tony Dotson of KoSa.
Photos by Devin Steele

“We are not against lowering tariffs, but only if other countries lower theirs to match ours,” Weatherman said. “I will take comfort in the fact that this is only the first proposal. I urge you to lobby your Congressmen to voice your opinion on the matter.”

Weatherman also ran down a list of concessions made to GOP lawmakers, including Myrick, by the administration during the vote for trade promotion authority in December 2001. The promises were made to assist the industry in emerging from its doldrums.

“These are not a one-time deal,” he said. “If any of these promises are broken, all bets are off.”

James C. Leonard III, deputy assistant secretary for textiles, apparel and consumer goods industries in the U.S. Commerce Department, later told attendees that, “at least from my perspective, at this point, we’re adhering to those commitments.”

Leonard, fresh off a trade negotiating trip to Vietnam, addressed a number of the same issues as Weatherman. He also provided updates on the textile marker system being developed, export expansion, the Textile Working Group and intellectual property rights.

Other speakers included Udo Schweizer of PolySpinTex, who covered “Transfer Tail Splicing:” and Mark Harris and Manfred Stuettem of Barmag/Saurer Group, who highlighted their company’s CreelManager®.

Buffett drops offer to buy Burlington

March 17, 2003

GREENSBORO, NC — Burlington Industries is back on the auction block after a bankruptcy court balked at a breakup fee that led billionaire Warren Buffett’s Berkshire Hathaway to withdraw a $579 million bid for the textile producer.

A bankruptcy court approved new auction procedures that call for an auction to take place June 3 at the New York offices of company counsel Jones Day.

The court indicated it approved an agreement between Buffett and Burlington generally, but disapproved of the $14 million break-up fee and certain other conditions required by Berkshire to proceed as a “stalking horse” in the alternative bid process, the company said.

While the secured bank lenders were in support, unsecured creditors — led by WL Ross & Co., a private equity firm led by fellow suitor Wilbur Ross — opposed the granting of a break-up fee.

“It is unfortunate that the Berkshire Hathaway break-up fee was not accepted by the court and the offer has been subsequently withdrawn by Berkshire,” said George W. Henderson III, Burlington’s chairman and CEO. “It was a firm cash offer that would have been a good outcome for the company, our employees and our creditors. The fact that there is so much interest in the company is a credit to our employees that have worked so hard to get us to this point.”

Under the proposed plan with Berkshire Hathaway, Burlington’s secured creditors would be paid in full and its pre-petition unsecured creditors would receive cash and certain other assets estimated to be 34 percent to 35 percent of their claims. All shares of Burlington’s common stock would be canceled with no payment.

Also, Burlington would emerge with no debt, other than ordinary course liabilities and certain pre-petition obligations, having repaid the majority of the $1.1 billion of liabilities it had prior to its bankruptcy filing in November 2001, and eliminating the balance through the bankruptcy process.

“We’re sorry to have to terminate our offer,” Buffett said. “We trust and admire the Burlington team and hope the company can emerge bankruptcy debt free. Emergence from bankruptcy under a debt-free structure will provide the best chance for the long-term survival of Burlington and allow the company to best fulfill its pension obligations to employees.”

Under Ross’s previous plan, Burlington’s estimated $28 million of administrative claims and $439 million secured debt would be paid in full from cash on hand plus $250 million of new debt. The $300 million of bonds and other unsecured claims would be exchanged for 57 percent of the stock of the reorganized company.

Under the auction’s procedures, bidders have until May 28 to submit an offer for Burlington’s reissued stock or for all of its assets.

Textile executives talk up optimism

March 17, 2003

By Alfred Dockery

CLEMMONS, NC — As 2003 opened, American textile and industrial textile executives said they expect this year to be at least as good — and, they hope, better — than 2002, according to an informal survey by a leading industrial textiles newsletter.

For its annual economic outlook edition, the HunTex Report spoke with executives in a variety of areas, including nonwoven carpet, manmade fiber, specialty fabrics, cotton spinning and academia.

As a whole, respondents were upbeat if somewhat cautious.

Dina Dunn, vice president of Marketing for Nylstar North America, Greensboro, NC, was the most optimistic.

“This year is a big growth year for us,” Dunn said. “Our new Martinsville, VA, plant has brand new, state-of-the-art technology for producing nylon. Our main focus is apparel.

“With the Caribbean Basin Initiative (CBI) legislation in place, we need a very healthy plant to meet the needs of the United States and North America. Our outlook for 2003 is growth, growth, growth.”

At Avondale Mills’ Specialty Fabrics division in Graniteville, SC, business has been very good and the outlook is good. This division of Avondale coats woven and nonwoven substrates with acrylic, urethane, vinyl and silicone. Its growth has been driven by its ability to coat fabrics using solvent as well as water-based chemistries.

“Fiscal 2003 for us so far has been very good and I think it will continue. It’s strong early. Fiscal 2003 will be better than fiscal 2002,” said Kevin Crean, vice president, Specialty Fabrics, Avondale Mills Inc.

Crean reported that one of his facility’s five coating ranges is sold out for the rest of the year.

“We expect that 2003 will be a flat to slightly down year versus 2002. Our business is very dependent upon the automobile build rate in North America, and this is projected to be slightly down versus 2002 (2 percent to 4 percent),” said Lee Sullivan, general manager of the Tuft Division, Freudenberg Nonwovens, Durham, NC.

“However, the automobile build rate will still be relatively strong versus the historical averages, and 2003 will likely be the third or fourth highest rate of production in the history of the industry. So, on a relative basis, 2003 will be a reasonably good year.”

Challenges, opportunities

The biggest challenge that these executives see for the year ahead is making a profit. Price pressure is enormous and most of them would probably be happy just to hold what they have as far as margins go. All appear to be looking for niches.

“The challenge is to keep a viable strong industry here in the United States,” said Richard Gregory, Ph.D., director, School of Materials Science and Engineering at Clemson University, Clemson, SC. “The opportunities to do that are to move away from competition with countries that have very low labor costs that can run large volumes at relative low cost to making niche markets here in high-tech materials. The challenge is to move the industry this way, and for us academics to follow suit.

“A lot of the smaller companies that haven’t changed or are unwilling to change will eventually go away,” Gregory said. “The ones that are more dynamic like Milliken & Co. will always be in the forefront because they are making those changes.”

H. Malloy Evans, president of Cheraw Yarn Mills, Cheraw, SC, summed up the situation quickly and neatly.

“Our challenge is to improve margins,” Evans said. “We have the price of raw materials (cotton) going up and our customers saying ‘no, no’ to price increases. So you have both ends of the stick hemmed up.”

Alfred Dockery is editor of the HunTex Report, founded more than 10 years ago by Bob Huntoon. It is published monthly.

Manufacturers

March 17, 2003

Delta Mills to shut yarn-spinning plant

MAIDEN, NC — Delta Mills said it will close its cotton yarn production plant here in May, putting 120 people out of work. The facility makes yarn used in woven apparel fabric for Greenville, SC-based Delta Woodside, its parent company.

The lifting of import quotas from China were figured into the decision to close, Plant Manager Edwin Jeffords told The Hickory Daily Record. The company has owned the 115,000-square-foot plant since 1988. Delta employs about 1,600 people in five SC facilities and the plant here.

PGI out of Chapter 11; Zucker resigns posts

NORTH CHARLESTON, SC — Nonwovens producer Polymer Group, Inc. (PGI) announced March 6 that it has emerged from bankruptcy after 10 months.

On March 12, the company announced that Jerry Zucker has resigned as chairman, president and director in order in order “to focus his attention on his private company,” The InterTech Group, Inc. Zucker agreed to remain associated with the company as an advisor to the board of directors, PGI added.

The company appointed James L. Schaeffer as chief executive officer. He has been with PGI and its predecessors for 18 years, most recently as executive vice president and president of the Nonwovens Division.

Polymer Group now has total debt of about $500 million, down from about $1.1 billion when it entered the proceedings. Virtually all of its continuing suppliers with pre-bankruptcy claims are being paid in full, the firm added.

MatlinPatterson Global Advisers of New York, PGI’s largest bondholder, is the majority owner with more than two-thirds of the company.

PGI will initially have two traded classes of common stock consisting of about 9.6 million shares of Class A new common stock being issued to the creditors and 400,000 shares of Class B new common stock being issued to existing shareholders. Both classes have similar rights, with the exception of certain limited anti-dilution provisions for the Class B common stock.

Both classes of stock will trade on the OTC Bulletin Board. The Class A common stock will trade on a “when issued basis” with the symbol “POLGV,” while the Class B Common Stock will trade on a “when issued basis” with the ticker symbol “POLBV.”

The company is also issuing $50 million aggregate principal amount of 10 percent Convertible Subordinated Notes due 2007, which are initially convertible into shares of Class A common stock representing about 40 percent of the company’s outstanding equity securities.

Polymer Group, which employs about 4,000 people and operates 25 manufacturing facilities around the world, eliminated more than 400 jobs in 2001 before filing bankruptcy last May.

PGI is the world’s third largest producer of nonwovens.

National Spinning closing plant, expanding another

WASHINGTON, NC — National Spinning Co., Inc. March 12 announced the closing of its yarn-spinning plant in Lafayette, GA, and the relocation of the facility’s hand-knitting yarn-spinning operations to its Whiteville, NC, plant.

The closing is taking place over a period of 90 days and will affect 137 jobs.

The flood of imported yarns continues to erode the market for U.S.-made textiles and apparel, which has forced the company to consolidate its long staple spinning operation to a plant where more modern technology allows the production of yarns at a more competitive cost, the firm added.

The relocation is expected to add 25 jobs and secure existing jobs for more than 225 employees, the company said. When the move is completed by the end of this year, total employment at the plant is expected to reach 252 people.

“Efficient manufacturing is an essential strategy for our company,” said Jim Chesnutt, president and CEO. “This move and consolidation of yarn manufacturing for the industrial and hand-knitting markets reflects that strategy, while securing the future of operations in Whiteville.

“While it is difficult to close the operation in Georgia, the availability of a highly-trained, skilled work force in Columbus County, coupled with our modern production facility there, will assure the long-term success of the Whiteville Plant.

Operating since 1921, National Spinning Co. is a leading supplier of acrylic sales yarn in the industry. The company’s primary business is in high-quality dyed yarns and specialty spun yarns for the apparel, home furnishings, industrial, hosiery and craft markets.

The hand-knitting yarns that will be produced in the Whiteville plant will be marketed by the company’s Caron International division, a major producer of products for the home-craft industry in the U.S. and other international markets.

National Spinning, based here, operates six facilities in North Carolina employing more than 1,500 people.

Weavexx phasing out domestic operations

WAKE FOREST, NC — Production at a Weavexx manufacturing plant is being phased out by the end of the year.

The plant, which makes fabrics and felts for paper manufacturing, employs 132 people and is the last remaining textile plant in this Wake County town north of Raleigh.

Weavexx, which is owned by global technology group Xerium S.A., operates plants in Argentina and Brazil.

The plant’s outdated weaving, drying and stretching equipment led the company to reach the decision, according to reports. It makes more sense to move the jobs to plants outside the U.S., Barry Rubenstein, a lawyer working on behalf of Weavexx, said.

U.S. Cotton eliminating 110 jobs in St. Louis

ST LOUIS — U.S. Cotton said it will close its textile plant here in May, laying off 110 employees. The cotton goods manufacturer is based in Delaware.

Burton Corp. slashes 42 more employees

BURLINGTON, VT — Burton Corp., a snowboard, apparel and accessory manufacturer, eliminated 42 jobs earlier this month as part of a company-wide restructuring. The layoffs represent the company’s second cutback in a year.

Cotton

March 17, 2003

Cotton Inc. lead researcher to retire

Sasser

NEW YORK — Preston E. Sasser, Ph.D., senior vice president and managing director of research, is retiring after a 30-year career with Cotton Incorporated.

Sasser has long been acknowledged as one of the cotton industry’s leading research experts, instrumental in the solution of a wide range of cotton problems ranging from health issues to developing cotton testing technology. Several of his projects have been adopted nationally.

Sasser joined Cotton Inc. in 1973 as a research manager. In addition, he has held such posts as senior director, Fiber Quality Research, and associate director, Agricultural Research. Sasser has been in his current position since 1995.

Sasser has a long history with cotton. He received B.S., M.S., and Ph.D. degrees in agricultural engineering, with minors in mathematics and physics, from NC State University. Upon completion of his doctorate in 1964, the National Cotton Council hired him as a ginning engineer.

Prior to joining Cotton Incorporated, Sasser was director of Research with Motion Control Inc., Dallas, a developer and manufacturer of instruments used to test cotton fiber quality.

In the early 1970s, Sasser was a member of a team of engineers who created early high-speed cotton testing technology that eventually became known as High Volume Instrument (HVI) testing. Subsequently, Sasser served on the Secretary of Agriculture’s Advisory Committee on Cotton Marketing that decided that all U.S.-produced cotton would be classed with HVI instruments. This cost-effective and efficient procedure has immensely benefited cotton producers economically.

In his early work at Cotton Incorporated, Sasser led an extensive program of investigative research on issues relating to worker exposure to cotton dust. This health issue was linked to a respiratory disease called “byssinosis” or Brown Lung disease. This program led to the development of methods to minimize and control airborne cotton dust in cotton textile mills.

In 1998 and 1999, Sasser, a registered professional engineer, served on the team of Cotton Incorporated staff persons who worked to design and build the Cotton Incorporated World Headquarters and Research facility located in Cary, NC.

“You can’t replace a person like Preston Sasser,” said J. Berrye Worsham, president and CEO of Cotton Incorporated. “He is a professional of the highest order. We can only keep trying to match his devotion to our industry.”

Promotions

Separately, Cotton Inc. said it has promoted Vikki Martin to manager of Textile Chemistry Research. She was previously research chemist, Textile Chemistry Research.

Martin joined Cotton Inc. in July 2000 as a contract employee in the position of textile chemist, before becoming a regular employee in June 2001.

Martin attended NC State University, where she obtained bachelor’s and master’s degrees in textile chemistry. She is currently working towards a Ph.D. in fiber and polymer science at the school.

Cotton Inc. also promoted Michael D. Watson to vice president of Fiber Quality Research. He was previously senior director, Fiber Quality Research.

Watson began his career at Burlington Industries after graduating from NC State with a B.S. in engineering operations. He joined Cotton Incorporated in January of 1982 as process engineer, Product and Process Research. In July 1988, he was promoted to manager, Fiber Quality Research, becoming senior director of the department in January of 1995.

Also, Andrea Samber has joined Cotton Incorporated as associate director, retail marketing.

In this newly created position, her primary responsibilities will be to build relationships with retailers, initiate retail programs that increase cotton sales and build exposure of The Seal of Cotton trademark on retailers’ private label brands.

Samber will report to Paula Rosario, senior executive, retail and fashion marketing.

Most recently, Samber was promotions manager for Seventeen magazine, a subsidiary of Primedia, where she developed and executed magazine marketing programs for advertisers. Previous to that, she was the senior marketing manager for the relaunch of Teen magazine.

Samber also held the position of tourism marketing manager for The Galleria at Ft. Lauderdale, a super-regional shopping mall in Florida.

Samber received a bachelor’s degree in early American history with a minor in journalism from Brandeis University in Waltham, MA. She also has a master’s of tourism administration graduate degree, with a concentration in event marketing, from George Washington University.

Editorial

March 17, 2003

‘Made in America’ gaining steam?

THE “PRO-U.S. MANUFACTURING” movement, which has seemed to bubble under the surface of the free trade/globalization argument in recent years, has been poking its head from the cauldron lately. Sharing the boiling vat with that so-called protectionist movement are 2 million lost manufacturing jobs in just the last two years. Perhaps the fullness of the pot is helping the “pro-U.S. manufacturing” notion establish buoyancy.

Most recently, the sector lost another 53,000 jobs in February, marking a decline in manufacturing employment for the 31st consecutive month. As distressing: The seasonally adjusted number of production workers in the manufacturing sector fell below 11 million for the first time since 1946.

And the trade deficit? It actually narrowed in January to $41.1 billion, thanks in part to the decline of the U.S. dollar, the Commerce Department reported last week. But don’t get too excited — that’s still the second-biggest monthly deficit on record. Yippee.

Here’s how one textile industry wag interpreted those numbers: January balance of payments deficit with ...

• Japan = $5.22 billion
• the EU = $6.50 billion
• NAFTA partners = $7.97 billion
• China = $9.4 billion

Neglect of our economy = priceless.

TWO LONGTIME CHAMPIONS of manufacturing in general and textiles in particular are trying to do more to shore up their advocacy. U.S. Sen. Ernest “Fritz” Hollings and textile magnate Roger Milliken — both South Carolinians, incidentally — recently announced initiatives aimed at strengthening their message: That U.S. manufacturing is important to this country.

On March 11, Hollings introduced the Save American Manufacturing Act of 2003 in order to “help get American manufacturing off the canvas,” said Hollings, ranking member of the Senate Commerce, Science and Transportation Committee. The legislation would enact provisions to stem the export of manufacturing jobs overseas, combat the flood of manufacturing imports and stimulate manufacturing production in America.

Earlier this month, Milliken, chairman and CEO of Milliken & Co., expanded his grassroots textile/apparel lobbying group to include other manufacturing sectors. Renamed the American Manufacturing Trade Action Coalition, the organization aims to save manufacturing jobs that have been hammered by import competition — the result of what the group calls bad U.S. trade policy.

Whether or not Hollings’ bill gains any traction remains to be seen, but we commend the venerable Senator for his stepped-up efforts. And Milliken, the sage octogenarian, certainly knows the value of strength in numbers and a common cause.

NEITHER OF THESE recent actions by two of the Palmetto State’s finest is surprising, given their decades-long battles to preserve U.S. industry. The question is, will American consumers and lawmakers finally begin to see the connection between our trade policies and the loss of good-paying U.S. jobs? And, at the rate of $1 trillion worth of manufactured imports displacing American production each year, how much longer can we afford to wait?

We know that our ability to make things contributes mightily to the economic wealth, psychological health and security of this country. And that message needs to be heard by every American — before it’s too late.

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