More firms make offers for Mosgiel

Press, 12 July 1980, Page 3

More firms make offers for Mosgiel

PA WellingtonAn Australian firm, and! Norsewear Industries, were;, yesterday named as com-j panies interested in negotia-’ Xions on the future of Mos-1' giel, Ltd. *' 1 At Parliament, Mr J. H.l Talloon (Nat., Pahiatua) .said, that Norsewear had made; an offer to the Mosgiel re-| ceivers for purchase of some! of the plant, particularly; from the knitting division. [ From Auckland it was re-| ported that J. Barron and; Son Pty, Ltd, of Melbourne,; already'an importer of Mos-1 giel yarn, was prepared to) put' up capital in a bid to > ■ rescue the Mosgiel company. : Mr' Falloon said that Nor-i se\//ar was prepared to, ( move people from the Mos-1 giel area to work at its; branch factory at Takapau.i Norsewear had also adver-j tised in Otago for people! •with technical skills, but had} had onlv one reply. ?' j .Norsewear Industries had’ the potential to expand its} overseas market; Mr Falloon| said. Its only .problem was!, producing enough. Barron arid. Son Pty con- , verts raw wool into finished;, garments, which are sold tobig Australian retailers, and; producers spun woollen; yarns. It imports Mosgiel}.

\ arris. ■ Mr J. Geller, controller of; the knitting and spun wool-] len divisions, said yesterday; that if the talks were sue-; cessful his company would! aim to increase Mosgiel’s] export potential. ! It would also put up some; capital. Another company also reported as likely to participate in any rescue bid is Wool Yarns, Ltd, of Wellington. However, the Broadbank package to rescue Mosgiel, which was put to the Government on Thursday, is likely to succeed, according to the Woollen Mills Union national secretary (Mr L. Armitage). Mr.Armitage said yesterday that a top source inside.; the rescue group — Broad-1 bank Corporation, the Devel-I

■ opment Finance Corporation, Chase-N.B.A. and Associates ’ — had expressed confidence That a good enough deal had ibeen put to the Government,! iand tnat it was likely to be | accepted. .... : j Retention of employment} iunder the Broadbank scheme iwas about equal to that ; under the failed Alliance (Textiles offer, although the : same number of workers [would not necessarily be regained in the same areas of ’the Mosgiel group as Ali Hance had proposed. i The Minister of Trade and ! Industry (Mr Adams-Schnei-i der) said in Parliament, on } Thursday evening that a [significant offer had been [made, and was being considiered by the receivers. ] It is believed that the (offer is the one put together ■by Mosgiel, second-debenture (holders, led by Broadbank. | However, the offer makes [some Government funding 'necessary, and it must be 'considered by the Cabinet on i Monday, and approved at [that level, before the receivers can deal with it. I Commenting on the latest developments, the managing director of Alliance (Mr F.[ 18. McKenzie) said, ‘‘lf it is [correct that a new offer for: [Mosgiel requires Govern-} ment funding, it is at vari-j

jance with the policy that .$5l i million of bridging finance! should be for restructuring.” I ‘‘The new offer seems to Ibe a straight take-over for ian existing company in diffijculties, not rationalisation.” J In another development in 1 the troubled textile industry, Roydon Textiles, Ltd, has announced that it will close . its Invercargill factory on ! July 25. 7'he .decision had been . taken reluctantly because of a long period of cumulative ] losses and an almost com- . plete. absence of forward I orders, said Mr H. Water-i ’ house, manager of Roydon I Textiles, yesterday. Mr Waterhouse, said that • the staff of 45 had been told ; of the closing, and redun- ■ dancy negotiations were • ■under way with the tiniop.