Icahn will invest up to $200 million more in WestPoint Home
Staff Staff -- Furniture Today, December 11, 2006
New York -- In a strong show of support for WestPoint Home, investor Carl Icahn, who controls the major mill through his American Real Estate Partners holding company, said he will invest up to $200 million more in WestPoint, providing the textiles producer a comfortable cushion and the cash to continue building its off-shore manufacturing base.
American Real Estate Partners said it will spend $100 million to buy 1 million shares of a new issue of WestPoint Home preferred stock at $100 per share. Another 1 million shares priced at $100 a share will be made available to other investors -- and if there are no takers for that second block of stock, Icahn's company said it will purchase those shares as well, for a combined investment of $200 million.
The news would seem to knock down speculation from industry nay-sayers that Icahn has grown impatient with his WestPoint investment.
Icahn's cash commitment is the second strong dose of good news for the major mill in less than a month, following word the company had slashed its third-quarter operating loss by more than half from the preceding second quarter. Additionally, sales edged up by 1.4% during the third quarter, making steady gains throughout the year in a punishing retail environment that has hammered other textiles producers.
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