egetæpper a/s is contemplaring closing the production of its spinding mill in Vejle during the first half year of 2012. The factory employs 74 persons and produces carpet yarns, mainly for the group’s own use.
The production consists of 2 main products, viz. woollen yarns and polyamide yarns. We contemplate moving the production of woollen yarns partly to a 100% owned subsidiary in Lithuania, partly to the group’s factory in Herning, whereas the production of polyamide yarns may be outsourced to one of the group’s present yarn suppliers. A closing of the factory will affect 63 of the 74 staff members.
The intended closure takes place based on the competitive situation on the world market for carpets. The aim is to strengthen the group’s competitive position further. The production of carpets will continue on the group’s 3 other Danish factories, where 300 persons are employed.
A possible relocation and outsourcing of production is not expected to influence the result before taxation significantly this year, but in the long term we expect an annual saving of approx. 10 DKK million as well as a one-time income from the sale of building.
At the moment negotiations are conducted with the staff members as prescribed by law. We expect to end these negotiations at a liaison committee meeting on 19. December 2011.
