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

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news