- June 29, 2009
- Posted by: admin
- Category: Clothing and Textiles
All indications are that Seardel’s frazzled Frame Vertical Pipeline will be rescued. The team working on a strategy is due to announce its plan tomorrow or Wednesday.
Andre Kriel, the deputy general secretary of the Southern African Clothing and Textile Workers Union (Sactwu), said on Friday that the Department of Trade and Industry, the Industrial Development Corporation (IDC), the National Empowerment Fund, Sactwu and Seardel executives were meeting at the weekend to put final touches to plan.
Closing the spinning, weaving, finishing and denim departments of Frame had been dismissed as an option, he said. “The facility will continue to operate after tomorrow, when it will be revealed how we intend to go about it.”
More than 1400 jobs will be lost if no solution is found. Analysts said that the multiplier effect would mean more than 7 000 people would be affected if the facility closed.
Kriel said Sactwu made no secret of its interventions in Seardel, in which it is a shareholder with Grawood, A Searll Descendants and Hosken Consolidated Investments.
“Since Seardel advised us of its problems in mid-2008, we helped mobilise R250 million in fresh shareholder funds into the company to ensure the credit lines were open,” Kriel said.
Several meetings have been held this month to discuss ways of saving the industrial capacity and jobs at Frame. IDC chief executive Geoffrey Qhena said recently that one option would be to establish an entity that would house all of Frame’s assets.
He said that the task team had been working hard at finding a solution and that “all the hours spent on meetings about Frame was worth the amount of jobs that would be saved”.
Stuart Gottschalk, the deputy chairman of Clotex in the Western Cape, said myriad clothing and textile companies with proven profitability deserved as much aid as Frame.
Kriel said the IDC had aided more than 50 clothing and textile firms in the past two years. Brian Brink, the head of the Textile Federation, said he agreed with the bailout of a company as long as it did not impede other companies that continued to be profitable.
Source: Business Rpeort – Florence de Vries