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Hanesbrands plan includes cuts in Eden

Wednesday, September 24, 2008
(Updated Thursday, September 25 - 5:19 am)

Hanesbrands Inc. today announced a consolidation plan that includes closing yarn and knit-fabric textile plants in Eden where 720 people work.

The latest moves by the the Winston-Salem-based maker of Hanes and Champion apparel will consolidate production through nine plant closures in five countries, impacting about 8,100 employees. It also will complete the migration of the Hanesbrands' large knit-fabric textile production from the United States.

Locally, production is expected to finish by the end of the year at the company's yarn plant in Eden where 120 people work. The company also expects to close its knit-fabric textile plant in Eden, which employs 600 people, by the end of summer 2009.

In North Carolina, production will cease this week at the company's knit-fabric textile plant in Forest City, which has 470 employees, and at its yarn plant in Gastonia, which has 140 employees. Operations at the company's sheer hosiery inventory warehouse in Rockingham, which has 15 employees, are expected to end by the end of November.

The company will provide severance benefits and career transition assistance to employees.

"We are making significant progress in expanding our supply chain production capability in Asia and consolidating into fewer, larger facilities located in lower-cost countries around the world," Hanesbrands CEO Richard A. Noll stated in a news release. "Globalizing our supply chain, and eventually balancing production between Asia and the Western Hemisphere, is a critical plank in our strategic efforts to reduce costs, improve product flow and increase our competitiveness."

By the end of 2008, Hanesbrands is expected to substantially close: a sewing plant in El Salvador, affecting 2,600 employees; a sewing plant in Honduras, affecting 1,250 employees; a sewing plant in Costa Rica, affecting 1,250 employees; and two yarn plants, a knit-fabric textile plant and an inventory storage warehouse in the United States, affecting 745 employees.

By the end of summer 2009, the company expects to also close a sewing plant in Mexico, affecting 1,650 employees.

The moves will cost $76 million. Hanesbrands says it has now taken about $204 million of the $250 million in restructuring charges it expects to incur since it was spun off from food maker Sara Lee Corp. in 2006.

Accompanying Photos

File photo (Associated Press)

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