Veltex Corporation has signed a letter of intent to purchase MKL, Inc., Anaheim, California, in a cash plus stock transaction. MKL, a private company, specializes in embroidery of logos and other designs on caps and garments for the promotional products industry. The Company has a well-established reputation for quality and has been consistently profitable since its inception in 1975 with sales averaging $3 million annually in recent years.
“This is a very significant acquisition for Veltex in our business strategy to expand our distribution capabilities and scope throughout the U.S. and North America,” said Javeed Matin, Chairman, CEO and Founder of Veltex. “The acquisition should put us on track to reach our goal of exceeding $5 million in domestic sales this year because it allows us to offer the full range of services from manufacturing the textiles and clothing to adding the final touch of embroidered logos and decorative designs. We can produce apparel in both standard styles and custom order with whatever embroidered detail our customer wants, and since we do it all, our prices are exceptionally good,” said Mr. Matin.
In February 2004, Veltex initiated its expansion with a booth at the MAGIC Show in Las Vegas, one of the largest apparel trade shows in the country.
The Company also announced that in conjunction with expanding Veltex Apparel, it has dissolved its transportation division. While this division was grossing approximately $1.4 million annually, it was an unprofitable drain of cash and personnel. “This business decision to focus our efforts on being a totally vertically integrated company in the textile and apparel industry has already increased our focus, sales and profitability. This is the industry where we have great expertise and long-established contacts,” Mr. Matin said.
