Printer Friendly

SHAW EMBRACES ACQUISITION BID.

DALTON, Ga.-A week after Shaw Industries stunned the floor covering business by announcing it was considering an acquisition proposal from Berkshire Hathaway, Julius Shaw, executive vice president of investor relations, said, "Shaw is looking forward to a partnership with Berkshire Hathaway and its chairman, Warren Buffett. It's a great fit at this time."

In the proposal, Berkshire Hathaway would pay $19 a share for 80.1 percent to 86 percent of Shaw for a total of about $2 billion.

In its 29-year history, Shaw grew to be the largest carpet and rug manufacturer in the world through internal strategies and a string of acquisitions, including such mills as Philadelphia, WestPoint Pepperell's and Armstrong's carpet operations, Salem Carpet Mills and, most recently, Queen Carpets. However, being on the other side of the acquisition equation is just fine now, according to Julius Shaw. "If the proposal goes through, we'll be proud to be a part of a company like Berkshire Hathaway. It's a fine company with a great reputation."

Because Berkshire Hathaway is known for letting its operating subsidiaries continue to function fairly autonomously, being part of Berkshire Hathaway will make it easier for Shaw to pursue some plans that require a cash outlay without fearing a Wall Street backlash, according to Julius Shaw. And because Buffett and his company have encouraged everyone at Shaw to stay on -- even stipulating that Robert E. Shaw and Julian D. Saul, company officers, together with their families, will retain a minimum of 5 percent ownership -- Shaw employees and customers need not be concerned that there will be major changes. "There should be little to no change that will be noticeable," stressed Julius Shaw.

The first step toward the completion of the acquisition has been taken with the formation of a committee of nonmanagement members of the Shaw board of directors to review the proposal. "The committee will make a recommendation, probably by the end of the month. Then the board will vote on it and then Shaw will take it to the shareholders," said Julius Shaw.
COPYRIGHT 2000 MacFadden Communications Group LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2000 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Author:Herlihy, Janet
Publication:HFN The Weekly Newspaper for the Home Furnishing Network
Date:Sep 18, 2000
Words:342
Previous Article:DIRECTORY.
Next Article:FURNITURE.COM TEAMS WITH USGIFT.COM.

Terms of use | Privacy policy | Copyright © 2018 Farlex, Inc. | Feedback | For webmasters