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ITG Sells Mattress Assets To Culp

International Textile Group (ITG), Greensboro, N.C., has sold its Burlington House mattress fabrics product line to Culp Inc., High Point, N.C., for $2.5 million in cash and approximately 880,000 shares of Culp common stock. ITG will use the proceeds of the sale, which includes inventory and production rights for its mattress fabric patterns, to expand its global core businesses. Culp’s mattress fabrics focus and cost-competitiveness in that area are expected to benefit mattress customers.

“ITG continues to implement its business strategy of being a global textile fabrics and solutions provider focusing on markets where it is able to differentiate itself through innovative products, styling and competitive manufacturing facilities,” said Joseph L. Gorga, ITG’s president and CEO. “With its entry into the automotive fabrics business, through the merger with Safety Components International, ITG is also focusing on highly engineered technical fabrics.”

“We view this as a great opportunity for Culp,” said Robert G. Culp III, chairman of the board and CEO, Culp Inc. “Mattress fabric … accounted for approximately 40 percent of the company’s sales in our second fiscal quarter.” He said Culp recently has invested substantially in its mattress fabrics business, and the acquisition of the Burlington House assets will allow it to grow annual mattress fabric sales by some $25 million to $30 million without investing in fixed assets. He also said Culp’s existing capacity will accommodate the additional volume.

Delores Sides, director, corporate communications and human resources, ITG, said the transition of the product line from Burlington House to Culp will take two to four months. The exact impact on Burlington House employees isn’t yet clear, although Sides said there will be a reevaluation of capacity needs at the company’s Pioneer operation. “We do not expect significant change at our Burlington Finishing plant, as we are in the process of moving apparel fabrics into that plant, which we expect to balance our employment needs,” she added.

January/February 2007