Foamex Sells Asian Operation

August 6, 2007  by in UnCategorized   

By Home Furnishings Business in Furniture Retailing on August 2007 Foamex of Linwood, Pa., one of the industry’s leading producers of foam for mattresses, furniture and other products, said Tuesday it is selling its interest in Foamex Asia to its partner in the joint venture, Hua Kee Company Limited.

Foamex expects to net about $22 million from the sale of the operation it had owned a 70 percent stake in. It plans to use the cash to pay down debt.

Foamex CEO Jack Johnson said, “Upon an extensive review of our overall portfolio, we concluded that the ownership interest in this venture has not yielded satisfactory returns and is not positioned to facilitate our current global growth strategy. By selling our equity interest we unwind certain non-compete agreements and other restrictive agreements, thereby allowing us to concentrate on other business opportunities in the Asian markets where we see the most potential for growth. We are committed to leveraging strategic growth opportunities in Asia. Through this sale, we believe we will be better positioned to take advantage of the numerous opportunities previously unavailable to us in the Asian market.”