Coats Group acquires Patrick US yarn business

By

Sandra Halliday

Published
Dec 11, 2017

In a rare takeover of a US firm by a UK-based one, yarns giant Coats Group on Monday said it has bought Patrick Yarn Mill for an initial price of $21 million.

The move reflects the increasing importance of both performance yarns and of the eco movement in modern clothing manufacture with Patrick Yarn Mill being a key player in both these areas.

Coats, whose head office is in Uxbridge just outside of London, is the world's leading industrial thread manufacturer. Meanwhile 44-year-old Patrick is a manufacturer of high-performance engineered yarns and is based in North Carolina. It specialises in cut-resistant and flame-retardant yarns but also produces yarns from recycled fibres marketed under its earthspun trademarks. Its large solar installation promotes its earth friendly yarns as 'Spun by the Sun’. Patrick has 150 employees and saw sales last year of $36.5 million.

Coats said its new acquisition’s “unique spinning competencies in engineered performance yarns offer an opportunity to expand [its] existing Performance Materials portfolio as well as to extend its innovation capability.”

And the takeover could boost Patrick’s existing potential with its new owner ready to support its “expansion into high-growth markets by leveraging Coats' unrivalled geographic footprint, breadth of global customer relationships and strong corporate brand.”

As mentioned the initial payment is $21 million, but there will be further payments of up to $4 million over a three-year period to 2020, as long as Patrick Yarn Mill achieves certain performance targets.  

Coats Group CEO Rajiv Sharma said of the deal: “Patrick Yarn Mill is an exciting acquisition that supports a key aspect of our growth strategy: to identify innovative capabilities that build scale in high technology sectors. It is a dynamic, customer-focused company and its unique spinning systems combined with our existing technology portfolio will provide a strong market offering.”

He also highlighted the yarns giant’s strong track record of successfully integrating bolt-on companies following the acquisitions in 2016 of Gotex and Fast React, both of which “are performing well under Coats' ownership.”