Hopes for rescue as American company backs troubled Axminster carpet firm
An American company has emerged as the "strongest runner" in the race to snap-up ailing Axminster Carpets amid crisis talks to save the world-famous firm.
Last week staff and local residents in the Devon town were devasted after it was announced the 250-year-old firm risks closure with the loss of more than 400 jobs after making losses.
The company is expected to go into administration later this week before US equity firm Carlyle, which already owns Brintons Carpets, steps in. Carlyle took the helm at Brintons, the Kidderminster carpet maker, in 2011 after the firm suffered financial difficulties.
It is understood Axminster Carpets will appoint Duff & Phelps, the American financial restructuring firm as administrators this week.
Business Cards From Only £10.95 Delivered www.myprint-247.co.ukView details
Contact: 01858 468192
Valid until: Sunday, June 30 2013
Ian Jackson, managing director of Carlyle Group, told The Sunday Times: "Given we have a strong track record at turning around carpet companies, it would be remiss of us not to take a look if or when the company goes into administration."
A fall in export sales coupled with a rise in commodity prices have conspired against the company. The firm's latest accounts, filed at Companies House, revealed it made a pre-tax loss of £1.37 million in the year to December 2010.
Tim Jones, chairman of Devon and Cornwall Business Council has been involved with the talks held over the past few days to save the carpet giant.
He said: "Four companies have shown an interest in Axminster – Carlyle Group are the strongest runners.
"We are in the middle of encouraging ongoing negotiations which are at a very delicate stage. It's almost inevitable Axminster will go into administration at some point during the week. Axminster have a very good order book – they just need to get rid of debt.
"We want to try to make sure Carlyle Group don't just take the assets but keep the local operation going."
Richard Merrin, in charge of PR for Axminster Carpets last night refused to "comment on media speculation" regarding the Carlyle Group.
News the Americans had thrown their hat into the ring came yesterday following a demonstration held in support of the company on Saturday outside the Guildhall in the town.
Hundreds of people waved flags and placards with more than 500 members of the public signing a petition calling on the Government to help the stricken carpet company.
On-line petitions and a Facebook page have also been launched to garner support.
The Community union which is representing staff also has a petition on its website and has so far collected 1,000 signatures.
Lorraine Gaskell, campaign manager at Community described the show of strength on Saturday as "absolutely brilliant."
She said: "People in the town and even further afield feel very strongly that the business should be kept going. "The atmosphere at the demonstration was very upbeat and the support we've had to far has been brilliant."