Hicksville, N.Y.—In a move that will put The Dixie Group solely into the high-end carpet making business, the company announced it is selling off what amounts to approximately half its assets to Shaw Industries. The $180 million cash deal is expected to be completed by the end of this month. “The proceeds from the transaction will be used to reduce the company’s debt, and fund growth of our tufted residential businesses,” said Daniel Frierson, Dixie’s chairman and CEO. He noted the assets being sold include “our yarn, tufting, dyeing, finishing, needlebond, distribution and logistics facilities located in Calhoun, Ga., our needlebond plant in Dalton and our carpet recycling center in Lafayette, Ga.” In addition, the transaction includes a number of Dixie’s brands, including Bretlin, Globaltex, Metro Mills and Carriage Carpets.

Together, these businesses generated sales of approximately $255 million during the last 12 months and will leave Dixie with roughly $250 million in annual sales through its remaining brands, Fabrica International, Masland Carpets and Dixie Home, as well as its Candlewick Yarns division which serves specialty carpet yarn customers. In effect, noted Dixie’s Gary Harmon, the company “will now be focused on the high-end of the carpet business, an area where we have some of the best known brands in both Fabrica and Masland.” Julius Shaw Jr., Shaw’s executive vice president, said the company expects to keep the brands and facilities it is buying, calling them “strategically good fits. This not only complements a number of our existing businesses, such as in manufactured housing, but gets us into some areas of the soft surface business we are not currently in, such as needlepunch and grass. “It also complements our home center business,” he added, “as Globaltex was one of the earliest suppliers to The Home Depot and still remains an important customer.”

As for the facilities, Shaw said “that’s just another benefit to this deal. They are quality plants and are also all close in proximity to where we have a plant. In fact, the Calhoun operation is virtually new, so it is a very modern plant that brings many advantages with it. “Everything about the purchase is a strategic fit,” he continued. “Its helps us expand existing businesses, puts us in segments where we currently do not have a presence, and allows us to take advantage of our distribution fleet. It should integrate really well.” Being part of Bershire Hathaway means Shaw is no longer a public company so it does not have to announce annual sales. But sources close to the company tell FCNews the $255 million in sales from the businesses it is acquiring should all be added to the mill’s existing figures as there is virtually no duplication. They say the company should do approximately $4.7 billion in sales next year barring any other acquisitions, which they said is not out of the realm of possibilities.