Pillowtex Corporation

Pillowtex Corporation was a United States textile manufacturing company from 1954 to 2003. Originally established as a pillow manufacturer, Pillowtex's range of products extended to bed sheets, and mattress protectors.[1] The company was officially declared bankrupt on October 7, 2003, therefore Pillowtex sold its assets, including machinery and brands.

Pillowtex Corporation
Private
IndustryTextile
FateWent into bankruptcy, assets sold
SuccessorIconix Brand Group
Founded1954
Defunct2003 (2003)
HeadquartersDallas, Texas, Kannapolis, North Carolina
Key people
David H. Murdock
ProductsBedding products (pillows, towels, bed sheets, mattress protectors)
BrandsCanon
Charisma
Fieldcrest
Royal Velvet
Number of employees
14,000
ParentAmoskeag Company
SubsidiariesFieldcrest Cannon
Beacon Blankets

History

In September, 1997, Pillowtex adcquired the Fieldcrest-Cannon company for $700,000,000. Sales slid, and problems began to appear as Pillowtex lost money. According to a former CEO of Pillowtex, its largest product buyer, Wal-Mart, encouraged the company to move production overseas [to remain competitive] but Pillowtex refused. It was undercut by competitors (producing overseas at lower prices) and when its prices were no longer competitive stopped (or lost) its opportunity to supplying Wal-Mart.[2]

Three years later, in November 2000, Pillowtex filed for Chapter 11 Bankruptcy protection. In May 2002, Pillowtex briefly surfaced from bankruptcy for little more than a year, but things kept sliding.

On July 30, 2003, Pillowtex Corporation announced the complete bankruptcy of the company. Over the night of July 30, 7,650 people became unemployed (4,340 in Kannapolis alone). This was the largest permanent layoff in the history of the state of North Carolina. The bankruptcy announcement also included an agreement for Pillowtex assets to be sold to GGST LLC, a joint venture of four liquidation companies (SB Capital Group, Gibbs International, Gordon Brothers Retail Partners and Tiger Capital Group), for $56 million, subject to bankruptcy court approval.[3]

On October 7, 2003, Pillowtex won approval from a bankruptcy court judge to sell company assets, including machinery and brands, to GGST LLC for $128 million. The brands "Cannon", "Royal Velvet", "Charisma", and "Fieldcrest" became the intellectual property of SB Capital. The "Cannon" and "Royal Velvet" brands have been licensed by Li & Fung, headquartered in Hong Kong. "Fieldcrest" branded products have reappeared as "exclusively at Target". Iconix Brand Group bought the Pillowtex brands in 2007.[4]

The smokestack implosion of the remaining of Plant 1, on cAugust 10, 2006

Beginning in June 2005, workers of the D.H. Griffin Wrecking Company began the demolition of Plant 1, an area the size of The Pentagon. In November 2005, the eastern half of the Towel Distribution Center was imploded, and the main office building was completely demolished by the end of the year. Town Lake was drained and filled in.

On March 24, 2006, the remaining portion of the Towel Distribution Center and the Bleachery were imploded. Over 1,200,000 square feet (110,000 m2) was demolished, making it the third largest building implosion in U.S. history. A few months later, on August 10, the smokestacks were imploded. On November 8, of that year, the 268-foot (82 m) water tower was demolished, officially ending the Cannon Mills era.

Pillowtex filed a Chapter 11 bankruptcy petition in the United States Bankruptcy Court on July 20, 2003. A chapter 11 liquidating plan was confirmed, which created the Pillowtex Liquidating Trust.[5]

Many of its brands were purchased by Iconix Brand Group in 2007.[6] It was publicly traded on NYSE as PTX.[7]

The Pillowtex brand was bought by Pacific Pillows in 2009, which manufactures and sells memory and latex foam pillows under that name.[1] Oak Point Partners acquired the remnant assets of the Pillowtex Liquidating Trust in February 2012.[5]

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See also

References
  1. Pillowtex corporation info on Pacific Pillows (archived, 1 Feb 2014)
  2. The Age of Wal-Mart, CNBC television documentary, first aired late 2004.
  3. Mecia, Tony; Bell, Adam (2003-07-31). "Company gives up on rebuilding, returns to bankruptcy court". Charlotte Observer. Retrieved 2006-10-05 – via NewsBank.
  4. "Official Pillowtex, LLC to be Acquired by Iconix Brand Group, Inc". SB Capital Group, LLC. New York, NY. 2007-09-06. Archived from the original on 2014-08-26.
  5. Oakpointpartners.com
  6. Iconix purchase of Pillowtex gets US antitrust OK, Reuters, 1 Oct 2007
  7. Pillowtex: How did it find trouble? on Fool.com (archived, Mar 4, 2016)
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