Crailar moves to acquire European dyeing facility
06/09/2013
What it did say on making the announcement was that the facility has been in operation for more than 30 years and is situated in “one of the most prolific flax growing regions of western Europe”. This narrows the possibilities down to Belgium or perhaps Italy.
The facility is currently capable of producing in excess of 100,000 kilos of dyed flax fibre per week and has room for further expansion, Crailar said.
As part of the deal, the company said it would “retire” approximately $1.2 million of debts over the next three years, owed by the vendor. It will enter into a ten-year lease on the building, with a renewal option for an additional ten years and an option to purchase.
Crailar chief executive, Ken Barker, said on making the announcement that his company was excited about the prospect of having complete control of its production process. He said it also believed the move would offer it “an immediate path to positive gross margin with no capital outlay”. He added: “Acquisition of this facility would accelerate our production timeline by six-to-nine months, eliminate the construction risks inherent with a ‘green field’ project, and substantially reduce the capital required to achieve a capacity of one million pounds (450,000 kilos).”
Mr Barker also said that the plant’s location in an area known for “flax-growing excellence” would provide Crailar with an abundant source of feedstock and tie in perfectly with an initiative it already has in place to source flax in Europe. This is in addition to a longer-term plan to establish a fully integrated Crailar facility in Pamplico, South Carolina.
Founded in Vancouver in 1998, Crailar was originally a provider of environmentally friendly, ethically produced clothing. It quickly grew to become a developer of renewable and environmentally sustainable biomass resources using flax, hemp, and other bast fibres.
According to the company, it uses an enzymatic process to “unlock the potential of flax fibre” to produce garments that are as soft and durable as cotton, while “minimising the environmental risks associated with its cultivation”.
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