Furnishings manufacturer Leggett & Platt Inc. has bought Foamex International Inc.'s rubber and felt carpet cushion businesses for about $38.5 million to round out its carpet underlay offerings.
The sale includes a rubber cushion manufacturing plant in Cape Girardeau, Mo.-one of only two rubber cushion plants in the U.S.-and certain assets of Foamex's Newton, N.C., felt factory.
Leggett & Platt, which calls itself the ``premier manufacturer'' of carpet cushion in the U.S., said the deal would add about $40 million in annual sales to its ledger and make it the largest manufacturer of felt/fiber underlay in the U.S.
``This deal puts us into all the types of carpet underlay,'' said Larry Heppe, president of L&P's Urethanes Division, which will oversee the acquired business. ``We can now offer our customers pretty much whatever they want,'' he said, explaining that L&P already produces the other major types of underlay-bonded, molded and prime urethane and felt/fiber.
Foam rubber underlay can be made in a variety of grades, he said, but it tends to be a high-end specialty application, especially suited for commercial uses.
Heppe said the Foamex business is profitable, and L&P already is evaluating it for possible expansion.
He declined to say what L&P's sales of carpet underlay are, but L&P documents show that fabric, foam and fiber products represented 16 percent of 2004 sales of $5.09 billion, or more than $800 million. L&P makes carpet underlay products at 20 plants across the U.S., Heppe said.
The sale in a way resurrects an assets swap the two firms tried to carry out three years ago. At that time, L&P was to have swapped its polyurethane foam business for Foamex's carpet underlay activities.
Linwood, Pa.-based Foamex, a manufacturer of flexible polyurethane and advanced polymer foam products, said it will use the proceeds of the sale to pay down debt.
Tom Chorman, Foamex president and CEO, called the businesses non-strategic and not part of its core urethane operations. Foamex will continue to serve the rebond and prime segments of the carpet cushion market, which accounts for more than 85 percent of the national market, he said.
``By concentrating on our core business,'' Chorman said, ``we will be better able to develop innovative products that meet the quality and performance standards of our customers.''