Guilford Mills to file Ch. 11, exit home fabrics
By Furniture Today Staff -- Furniture Today, March 10, 2002
GREENSBORO, N.C. — Guilford Mills no longer will make upholstery and other home furnishings fabrics as it seeks to restructure under Chapter 11 bankruptcy protections.
The company's upholstery offerings have dwindled in recent years, and it has not been a significant supplier to the industry.
Guilford said it would file a "prepackaged" Chapter 11 plan, approved by its lenders, that would reduce debt from $270 million to $145 million and ensure that its unsecured trade creditors, owed about $25 million, will be paid in full.
Guilford will now focus on its automotive and industrial fabric businesses, although it will retain one apparel operation in Mexico.
John Emrich, president and chief executive officer, said the company expects to emerge from bankruptcy proceedings early this summer.
"The reorganization will preserve a portion of the company's equity for our current shareholders and protect our unsecured trade creditors," Emrich said. "With a successful operational restructuring completed and the company on the verge of concluding a recapitalization, Guilford and its associates can look forward to a bright future."
Guilford lost $160.8 million in its last fiscal year ended Sept. 30, and its stock was delisted by the New York Stock Exchange after falling to 26 cents per share.
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