Springs Industries Inc., Fort Mill, S.C., announced it has agreed to acquire the stock of Regal
Rugs Inc., North Vernon, Ind., the wholly owned subsidiary of Readicut International, the United
Kingdom.The strategic acquisition will further expand our bath and accent rug product lines, said
Crandall C. Bowles, Springs chairman and CEO. This purchase will continue Springs strategic
emphasis on increasing sales through acquisitions that complement our already extensive line of
home furnishings.The purchase price of $30 million is subject to adjustments based on Regals net
assets as of the closing and related to certain incremental tax liabilities that might be incurred
by Readicut as a result of the transaction, the companies said. Regal will operate as a subsidiary
of Springs.Springs will also acquire the remaining 50 percent interest in American Fiber Industries
LLC (AFI), Commerce, Calif. Springs acquired its current 50 percent in February 1997.AFI
manufactures and distributes bed pillows, mattress pads, down comforters and comforter accessories.
It will operate as a subsidiary of Springs Industries, with Jack Foley as its president.Jack and
Janet Foley have owned AFI since 1990 and control the remaining 50-percent interest in the
company.Springs also announced that it sold its Springfield Division to a management group led by
Edward N. Shogan, the divisions president since 1989.Over the past decade, Springs has
strategically repositioned itself from a manufacturer of apparel fabrics to leadership in home
furnishings, Bowles said. This divestiture marks another major step in this process and allows us
to focus all of our efforts on improving our home furnishing business.Springs received
approximately $46 million for Springfield, including a preferred equity interest of $10 million in
the business. According to the company, Springfields 1998 sales approximated $120 million.The
company also announced that it sold its Industrial Products Division to Chiquola Industrial
Products Group LLC, an investor group led by Marvin B. Fuller, a former Springs executive, for a
price in excess of $24 million.Consideration for the sale was in the form of cash, a subordinated
note and a limited, preferred equity position in Chiquola, Springs reported.
February 1999
