Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, August 25, 1994 TAG: 9408250091
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: By SANDRA BROWN KELLY STAFF WRITER
DATELINE: LENGTH: Medium
Financial terms of the sale were not revealed, but Robert Adler, president and principal owner of Halmode, said the agreement calls for Halmode management to remain for at least five years. He said if there are any immediate changes at the company, he expects them to be positive, such as the expansion of Halmode and perhaps better benefits for employees.
Because Kellwood is international, Adler said it should help Halmode develop an export business, for example, and its size - Kellwood is a Fortune 500 company that had $1.2 billion in sales last year - should give Halmode, which last year reported sales of $150 million, greater power in purchasing everything from supplies to health care.
"Kellwood is buying Halmode because it likes what Halmode is doing. It is not going to change what it's doing," Adler said. "They will allow us to run our own business."
In recent years, Halmode has been courted by "all the blue chip companies in the industry," he said. "We had our choice, and we selected Kellwood."
The sale must be approved by the Federal Trade Commission, but it is expected to be completed during Kellwood's second quarter, which ends Oct. 31.
Halmode, founded in Roanoke in 1963 and privately owned, employs about 1,000 people, half of them in the Roanoke Valley at its headquarters and plant on Wertz Road Northeast. It also has plants in Covington and New Castle, a Vintage Blue junior sportswear division in California, and contract sewing operations in Malaysia and Singapore, plus a New York sales office where Adler is based.
Halmode labels include Nursemaids, Sunshine and Snowbird uniforms, Kathie Lee for Plaza South, Melissa Harper or MHM, Halmode Petites, Halmode Plus and Great Times maternity wear.
Halmode employees learned of the sale Wednesday but had been aware for weeks that it might be coming, said H.D. Kemp, general manager in Roanoke.
"I think people are somewhat relieved that it's over, because we have been under such scrutiny," Kemp said.
The Roanoke facility has played host to a steady stream of Kellwood executives, and "auditors camped out here the last two or three weeks," he said.
Acquisition of Halmode allows Kellwood to continue to expand its apparel products, said William J. McKenna, chairman, president and chief executive officer of Kellwood.
Kellwood, an international marketer, merchandiser and manufacturer of apparel, home fashions and camping products, was founded in 1961. It has 15 business units that for the year ended April 30 had total net income of $35.6 million. Profit per share rose 23 percent, to $1.71, for the year.
Kellwood stock closed at $24.621/2 Wednesday, down 621/2 cents from Tuesday. The stock trades under KWD on the New York Stock Exchange.
Kellwood operations are spread over several states and into other countries. They include California Ivy Inc. of Vernon, Calif., Cape Cod-Cricket Lane of West Bridgewater, Mass., American Recreation Products Inc. of St. Louis, Kellwood Home Fashions of Perry, Ga., Crowntuft Manufacturing of New York, and Smart Shirts Ltd. of Hong Kong.
Smart Shirts this year signed a licensing agreement for WR (wrinkle resistant) technology with American Textile Processing of Cincinnati for process technology and trademarks related to the special process.
The first processing system was installed in the Far East in May to produce men's and women's shirts for the U.S. market. The shirts will be marketed under the "Miracle Care" trademark and will be shipped for this year's holiday season.
by CNB