New York City-based financier Carl C. Icahn has submitted the winning bid in an auction for West
Point, Ga.-based textile giant WestPoint Stevens Inc. Icahn’s $703.5 million offer – tendered
through an indirect subsidiary of American Real Estate Partners LP (AREP), which he controls – won
out over a lesser bid by Wilbur L. Ross, also of New York City, and a steering committee comprised
of a group of the company’s first lien holders.
Icahn holds a majority of WestPoint Stevens’s second lien debt as well as a portion of its
first lien debt. His offer includes a $187 million cash investment for 17.5 percent of the equity
of WS Textile Co. Inc., a new company to be formed to take indirect ownership of WestPoint
Stevens’s assets; a $125 million rights offering for 47.5 percent of said equity; and an issuance
of new stock to the company’s first lien holders for 35 percent of the equity. AREP is expected to
be WS Textile’s majority owner, possibly owning up to 79 percent of the company.
Icahn is chairman of the board of AREP’s general partner, American Property Investors Inc.
Commenting on his successful bid, he stated, “We look forward to continuing to earn the trust of
WestPoint’s customers, employees and vendors.”
“Court approval of the sale agreement for WestPoint Stevens brings us closer to the
successful conclusion of our reorganization process,” said M.L. “Chip” Fontenot, president and CEO,
WestPoint Stevens. “Going forward, we will seek to take advantage of global opportunities.”