On the heels of Maldens exit from Chapter 11 last week, Burlington Industries creditors approved the acquisition of the company by takeover king WL Ross & Co. LLC, enabling the company to emerge from bankruptcy protection on November 10, 2003. The majority of current senior management of the company, which had come close to saving the company through an acquisition by Warren Buffett in February 2003, will all be leaving the company to “pursue other opportunities”.
The new management structure will consist of Wilbur L. Ross as Chairman and Joseph L. Gorga as President and Chief Executive Officer. Mr. Gorga joined Burlington in 2002 as EVP of North American Operations.
The Ross acquisition was made possible by WLRs objection to the initial Buffett cash bid of $579 million that included a $14 million breakup fee and certain other conditions that Buffetts Berkshire Hathaway required to proceed as a “stalking horse” in the bidding process. The Delaware bankruptcy judge balked at the fee and Buffett walked on the deal in early March.
Ross eventually won the deal in the bid process with an offer of $608 million and a 1% breakup fee.
In other news, Burlington announced that Nike Golf will be using NANO-DRY enhanced fabrics in Tiger Woods golf pants. The company has also entered into a new licensing arrangement with Kayser-Roth for a series of new items under the Burlington B label.