Versa Capital Management has agreed to sell Polartec, a maker of polar fleece fabric and other textiles, to Milliken & Company.
In February 2007, Versa (then Chrysalis Capital Partners) formed Polartec to acquire the assets of Malden Mills Industries following a bankruptcy filing by the company in January 2007.
Malden Mills’ troubles began in December 1995 when a boiler at the company’s Lawrence, MA plant exploded destroying three of the factory’s buildings. The fire put 3,000 employees out of work. Owner and CEO Aaron Feuerstein decided to continue paying the salaries of all the now-unemployed workers while the factory was being rebuilt. In November 2001, Malden Mills declared bankruptcy after the recession at the beginning of the new year left the company unable to pay creditors—related to its rebuilding and payroll commitments. After a restructuring with creditors and a government subsidy, the company emerged from bankruptcy in August 2003. In January 2007, Malden Mills would file for bankruptcy one last time.
Today, Polartec manufactures a range of base, insulation, protection, and flame resistance fabrics that are sold to garment manufacturing companies. The company’s fabrics range from lightweight wicking and cooling fabrics, to insulation and weather protection textiles, and are used by leading consumer brands; the US military; and flame resistant, workwear, and contract upholstery manufacturers.
Polartec, led by CEO Gary Smith, is headquartered in Andover, MA with manufacturing facilities in Hudson, NH (www.polartec.com). “With more than 150 years of textile innovation, Milliken is the best possible ‘natural owner’ of a brand with Polartec’s pedigree. I look forward to supporting the integration,” said Mr. Smith. “I’m grateful to Versa Capital Management for their support in realizing Polartec’s full potential, and I’m extremely proud of the global Polartec team for their dedication and hard work that put the company in the position it is in today.”
“Milliken provides the perfect platform to ensure the continuation and acceleration of the success of the Polartec brand after years of complex and transformative business repositioning by Gary Smith and his team,” said Greg Segall, CEO of Versa and chairman of Polartec. “It has been a great collaboration with Gary and all of Polartec’s valued employees, and we are proud of all that has been accomplished during Versa’s ownership – notably the feat of reviving an American textile icon and powerful global brand into an enterprise equipped to succeed in today’s highly competitive markets. Milliken is the ideal long-term owner for Polartec, and we look forward to seeing the two companies achieve big things together.”
Milliken & Company is a diversified industrial manufacturer with interests in specialty chemicals, floor coverings, performance and protective textile materials, and healthcare. The company, owned by the Milliken family, was founded in 1865 and is based in Spartanburg, SC with manufacturing facilities worldwide (www.milliken.com).
“Polartec brings a wealth of new and respected outdoor textile expertise to complement Milliken’s strengths,” said Halsey Cook, president and CEO of Milliken. “This strategic acquisition broadens our textile capabilities with a product offering to now include fleece and soft-shell outerwear, among others, allowing us to grow in new and exciting spaces.”
Versa Capital Management makes control investments in companies with revenues from $50 million to $1 billion or assets of $25 million to $500 million. The firm is based in Philadelphia (www.versa.com).
Lazard Middle Market was the financial advisor to Versa and Polartec.
This transaction is expected to close before the end of June.
© 2019 Private Equity Professional | June 13, 2019
