Small steps of FDI, globalization and outsourcing...

The Times
March 22, 2006
Saddlemaker’s rescue proposalBy Peter Klinger

BRITAIN’S equestrian elite could be riding on Ethiopian saddles in their quest for 2008 Olympic gold after Pittards, the loss-making 180-year-old leather group, announced plans for a drastic restructuring to prevent its collapse.
As part of the restructuring, Pittards will close its Leeds plant, threatening 360 jobs, and shift production of shoe leather and other leather goods, including saddles, to Yeovil and the Ethiopia Tannery. The tannery, which is Ethiopia’s largest, has been under Pittards’ management since last year.
Pittards has long claimed to be at the forefront of saddle designs and is a key sponsor of Jeanette Brakewell, an Olympic silver medal-winner and two-time European champion. The group dates from 1826, when Charles Pittard set up shop as a leather dresser in Yeovil. Since then, Pittards has won national acclaim for supplying leather gloves to RAF pilots during the Second World War and providing leather for boots worn by England football teams.
However, the soaring cost of being a UK manufacturer, while competing with rivals from low-cost countries, has taken its toll. Last year, Pittards’ pre-tax losses hit £10.4 million, after a £4 million loss in 2004. Its £1.7 million market capitalisation is dwarfed by a £32.9 million pension deficit. Pittards is seeking entry to the Pension Protection Fund.
Pittards proposes a company voluntary arrangement, under the Insolvency Act, which will include a £2 million equity raising and allocation of 18.5 per cent of its expanded equity base to its pension schemes, which will also hold a security on the Yeovil plant. The shares are suspended on AIM.

http://business.timesonline.co.uk/article/0,,8209-2097704,00.html