Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Godfrey Hirst buys Oamaru plant, 192 staff on notice

Godfrey Hirst buys unprofitable Oamaru plant, 192 staff on notice

Jan. 31 (BusinessDesk) - Godfrey Hirst, the biggest carpet maker in Australia and New Zealand, has bought Oamaru's unprofitable yarn-spinning plant from Japan's Sumitomo Corp, effectively putting 192 staff on notice as it looks at ways to turn the operation around.

The company, which bought the Feltex business out of receivership, was granted Overseas Investment Office approval to buy the assets last month. It is reviewing the wool yarn spinning business to see how best to manage the loss-making plant, Godfrey Hirst said in a statement.

The plant has been on the market for the past two years, with Godfrey Hirst the only viable buyer, and ends a 21-year ownership by the Japanese group.

"This was driven by a number of factors affecting trading results including an unfavourable exchange rate and less local demand for wool carpets,” Summit Wool Spinners managing director Harry Ogawa said in a statement.

Summit Wool Spinners was one of a handful of companies that participated in the government's "nine-day fortnight" scheme in 2009, which came out of the Jobs Summit at the start of the current National-led administration. The scheme let companies cut staff hours by one day a fortnight to receive a subsidy on wages and saved a reported 377 jobs.

Summit Wool Spinners told staff the plant will be closed some time near the end of February, according to a joint statement by the Engineering, Printing and Manufacturing Union and First Union.

"Summit has been a very good employer and didn't want to make these redundancies," EPMU organiser John Gardner said. "The government's refusal to act on the overvalued exchange rate or provide any kind of strategy for manufacturing means they were left with few options."

Union members were told of the decision this afternoon, and will receive redundancy compensation through their collective agreements, the unions said.

The proposed closure coincides with the Parliamentary inquiry into manufacturing job losses being run by Opposition parties, who claim nearly 40,000 jobs in the sector have been lost since 2008.

The wool carpet sector has been in disarray in the past couple of years as high wool prices and cheap synthetic alternatives have eroded their customer base and squeezed their margins.

NZX-listed Cavalier Corp, which left the stock exchange's top 50 index this month, shut a yarn spinning plant in Onehunga last year due to over-capacity in the sector.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Trade Agreements: TPP Minus US Starting To Gain Ground

The Japanese government is picking up the pace on reviving the Trans-Pacific Partnership trade and investment deal, with talks scheduled next month among the 11 countries left in the pact after the withdrawal by the US after the election of president Donald Trump. More>>

ALSO:

PACER:

Prices Up 2.2%: Annual Inflation Highest In Over Five Years

"Rising petrol prices along with the annual rise in cigarette and tobacco tax lifted inflation," prices senior manager Jason Attewell said. "Petrol prices in New Zealand are closely linked to global oil prices, and cigarettes and tobacco taxes rise in the March quarter each year". More>>

ALSO:

Undertaxed? NZ Income Tax Rate Second Lowest Among Developed Nations

New Zealand workers pay the second smallest portion of their income to the government among developed nations and less than half the average ratio of their Organisation for Economic Cooperation and Development peers. More>>

ALSO:

Cyclone Cook: Round Up Of This Week’s Weather

One of the significant impacts this week was flooding due to excessive rainfall amounts. Rainfall amounts topped out at 350mm over the past 60 hours in parts of northwest Nelson, with 200mm+ measurements recorded about Coromandel Peninsula, and between 150-200mm in the Kaimai Ranges. Rainfall amounts of between 30-50mm were commonplace elsewhere. More>>

ALSO:

Earlier: Batten Down The Hatches For Cyclone Cook

Although fast-moving, Cyclone Cook will be destructive and MetService Expert Meteorologists have issued Severe Wind Warnings for the whole of the North Island apart from Northland... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news