18 June 2002 22:25 [Source: ICIS news]
HOUSTON (CNI)--BASF Corporation agreed Tuesday to sell its US Basofil heat and flame resistant fibres business to a newly created textiles marketing and technology company focused on the flame resistant mattress market.
Neither BASF nor the buyer, McKinnon-Land-Moran (MLM) of Charlotte, North Carolina would divulge the sales price for the Basofil manufacturing operations located at Enka, North Carolina.
But MLM's John Moran told CNI that he and his partners will create a new company called Basofil Fibers to run the business with headquarters in Charlotte where BASF has based the Basofil fibres business and marketing teams.
BASF said the deal includes the transfer of intellectual property, inventories, machinery and equipment at the Basofil manufacturing site in Enka, North Carolina. That plant employs 16 workers and BASF said it expects no job losses from the transaction.
Moran told CNI that MLM anticipates expansion as US state legislatures move forward with plans to require more flame resistant mattresses. The company has focused on California as a key state planning more stringent rules.
He noted that partner Frank Land is the inventor of a flame resistant yarn technology called Alessandra that uses Basofil fibre as a component. Alessandra is used to make ticking fabric for mattress and box spring sets.
Explaining the sale, BASF spokesman Jack Dellinger said a company assessment of the Basofil business showed that BASF needed a strategic partner to fully capitalise on the fibre's potential for introduction into new market segments.
He said BASF identified MLM as a potential buyer through its customer-supplier relationship.
Dellinger said: "For BASF, melamine-based Basofil fibres offer limited synergy with other value chains. Sale of the Basofil operation to MLM maintains jobs at the Enka location and provides opportunities for growing the business."
The statement from BASF also quoted Bob McKinnon, chairman and chief executive officer at MLM, saying that the acquisition will allow MLM to further develop and expand its product line with woven ticking products, interliner products and nonwoven, high-loft products for flame resistance.
Based in Mount Olive, New Jersey, BASF Corporation is the North American affiliate of Germany's BASF.
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