Ruddick Corp., the parent company of the Harris Teeter grocery chain, is selling its American & Efird Inc. industrial thread operation to a private investment firm for $180 million.
Two affiliates of KPS Capital Partners LP will get American & Efird’s 23 plants and 11,000 global employees in the deal. That includes plants in Mount Holly and Gastonia.
“This transaction allows the management team and their associates at A&E to continue to pursue their strategic plan of transforming A&E into a more Asian-centric enterprise, which has been years in the making,” said Thomas Dickson, chairman, president and CEO of Ruddick. The deal is expected to close in the first quarter.
Ruddick (NYSE:RDK) expects to record pre-tax non-cash impairment losses and other related expenses totaling between $42 million and $48 million in the fourth quarter of fiscal 2011, which ended Oct. 2.
The after-tax impact to fourth quarter results is expected to range between $33 million, or 68 cents per diluted share and $37 million, or 75 cents per diluted share.
“As A&E’s business has grown substantially in Asia it has become less of a domestic company and more of a complex international manufacturing company and its strategic fit with Harris Teeter has become less evident to our shareholders,” Dickson said in a statement. More.