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 HIGH POINT, N.C., Oct. 13 /PRNewswire/ -- Culp, Inc. (NASDAQ-NMS: CULP) today announced a definitive purchase agreement to acquire the operations and assets relating to the upholstery fabric businesses operating as Rossville Mills, Chromatex and Rossville Velours. Each of these operating units is owned by Rossville Companies, Inc. which is a privately owned corporation based in Rossville, Georgia. Closing of the transaction, which is subject to certain conditions set forth in the agreement, is expected within the next 30 days. The transaction is valued at approximately $34 million and involves the purchase of assets for cash as well as the assumption of certain liabilities.
 "This represents an important acquisition that will position Culp as the nation's second largest manufacturer of upholstery fabrics," remarked Robert G. Culp, III, chief executive officer. "We are confident this is a sound strategic step for Culp, particularly considering the ongoing consolidation occurring in the home furnishings industry. Rossville/Chromatex's focus is on dobby and jacquard fabrics, two lines of upholstery fabrics that are also key elements of our business plan. The addition of Rossville/Chromatex's resources will add significantly more volume and depth to our marketing activities. We will accordingly be able to work much more closely with the larger furniture manufacturers, many of which now use both Culp and Rossville/Chromatex as a supplier. Rossville/Chromatex's business will also broaden Culp's marketing base, and we are committed to maintaining the high level of service that these accounts expect.
 "Rossville/Chromatex's sales of upholstery fabrics currently amount to approximately $60 million on an annual basis. The incremental volume from this acquisition will clearly represent major growth for us. Of the net sales of $201 million for Culp's fiscal year ended May 2, 1993, upholstery fabrics accounted for $168 million, or 84 percent of the total. The acquisition of Rossville/Chromatex should have a positive impact on Culp's performance during the second half of the current fiscal year."
 Culp commented: "The operations we are acquiring will be organized under the newly formed Rossville/Chromatex Division of Culp. Dan Jacobs, currently chief operating officer with Rossville/Chromatex, will serve as chief operating officer of the new division. Dan has a background of more than 20 years with Rossville/Chromatex. His responsibilities will include all aspects of the division, including design, manufacturing and sales. We are pleased that he has accepted this role which includes many of the same activities he has been managing very effectively. Dan will be reporting directly to Howard Dunn, president and chief operating officer of Culp. We are confident that under this organization, we will be successful in utilizing Culp's financial and managerial resources to build on the excellent reputation that Rossville/Chromatex has established in the marketplace.
 "Our past progress in becoming a fully integrated manufacturer involved several strategic acquisitions. This planned purchase of Rossville/Chromatex represents a large investment by Culp but one which we are confident will serve as a key element of our future expansion. We are excited about the added potential which Culp will have once the acquisition is completed."
 The assets that Culp is acquiring through this acquisition include manufacturing facilities in Rossville, Georgia, and Hazelton, Pennsylvania. The plant at Rossville produces dobby fabrics and woven velvets. The facilities at Hazelton are operated under the Chromatex name and include both a jacquard weaving and finishing plant.
 Culp, Inc. is a leading manufacturer and marketer of fabrics for the furniture, bedding and institutional furnishings markets. The company's common shares are traded on The Nasdaq Stock Market (National Market) under the symbol CULP.
 -0- 10/13/93
 /CONTACT: Frank Saxon, vice president and chief financial officer, of Culp, 919-888-6266/

CO: Culp, Inc.; Rossville Companies, Inc. ST: North Carolina, Georgia IN: TEX SU: TNM

CM -- CH013 -- 1826 10/13/93 16:04 EDT
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Publication:PR Newswire
Date:Oct 13, 1993

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