Malden Mills

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Malden Mills Industries is the original manufacturer of Polartec polar fleece and manufactures other modern textiles. The company is located in Lawrence, Massachusetts and also has operations in Hudson, New Hampshire.

1 Fire and rebuilding
2 Bankruptcy
3 References
4 External links

[edit] Fire and rebuilding

For more on this topic, see Aaron Feuerstein.

The Malden Mills factory burned down on December 11th 1995, CEO Aaron Feuerstein decided to not only use his insurance money to rebuild the factory, but also to continue paying the salaries of all the now-unemployed workers while the factory was being rebuilt. Despite what was publicly reported, the union workers were only paid for 3 months. Many workers waited over a year to be called back to work. Also, workers were paid an average of 80% of their salaries. By going against common CEO business practices, especially at a time when most companies were downsizing and moving overseas, he achieved a small degree of fame. ^[1]

[edit] Bankruptcy

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. The company achieved solvency because of the generosity of its creditors, as wells as government subsidies. Feuerstein was relieved of actual control of the company by its creditors.

In January 2007, current CEO Michael Spillane announced that Malden Mills would file for bankruptcy again and would be sold to the Gordon Brothers Group of Boston. ^[2]^[3]

However, in February 2007, the assets of Malden Mills were purchased by a newly formed company called Polartec, LLC which is owned by Chrysalis Capital Partners of Philadelphia, PA.^[4]

A notice on the MaldenMillsstore.com Web site said the week of July 23 would be the final shipping period for rolls of fabric from the company. The notice also said an employee group is starting a new fabric-making enterprise to be announced.^[5]

June 28, 2007, the federal Pension Benefit Guaranty Corp. said it would take over the underfunded (by 49%) Malden Mills pension plan, which covers about 1500 employees. PBGC said the sale of Malden Mills assets meant that the pension plan would be abandoned because the company missed a $1.7 million pension payment. ^[6]