spin meister, The

Business, North Carolina, Oct 01, 1998 by Frew, Alex

Duke Kimbrell likes stuff. To be more specific, buying stuff. Sitting in the conference room off Garrison Boulevard in Gastonia, under the water tower boasting Parkdale Mills Inc.'s green-and-white logo, next to the plant bearing his name, he ponders his latest acquisition: a Citation VII twin-engine jet that's soon to arrive. The room is decked in we-win-awards regalia -- a glass plaque declaring his induction in the Cotton Hall of Fame, the black-and-white shell for the American Textile Institute's 1997 innovation award, a glass statuette declaring Parkdale one of the North Carolina 100.

But more than any award, Kimbrell seems proudest of a foot-long model airplane, and what it represents: a green-and-white Citation V, the first jet he bought. Or his company bought. He takes full credit.

He gets up and stomps over to a New York Cotton Exchange chart on the wall that maps the commodity's highs and lows back to 1981. There's a pronounced dip in the mid-'80s. "Now this is what I want to show you -- 1985, we got on the right side of that. Bought it all." Then you notice the sketch on the wall below. It's of a Citation. "I want to show you what I did. When I caught 1985, then I bought this." His index finger jabs at the drawing. I bought. Therefore I am.

The planes, now there are three, mean a lot to him. But he has bought much more -- 20 to 30 companies, he estimates, since becoming CEO in 1961, when the yarn maker had one mill. It now has 31. He jokes that he can't go and visit a friend's mill because rumors will rip through the industry that he's about to buy it. Sometimes he does.

"All these people we've bought -- Perfection mills, Rowan Cotton mills, Thomasville mills, the Belmont Heritage mills were direct competitors, and they were losing their ass at a time we were making money. I guess that's my life. Building up mills and making them make money. You ain't a Parkdale Mill unless it's up to the most modern, computerized, automated mill." Turning poor performers around is "what turns my adrenaline," he says.

The acquisitions have helped his company not just stay near the top of the North Carolina 100 but have propelled it almost to the crest. Parkdale has climbed from No. 11 on the first list, in 1984, to No. 2, the most significant move within the top tier. This year its sales will top $1 billion. In 1984, they were less than $200 million.

Margins are slim in yarn spinning. But being in a tough industry has allowed Parkdale to grow. Most of the companies it bought couldn't afford the capital to automate. Large apparel makers such as VF Corp. and Jockey International Inc. have called Parkdale in to consult on how to turn their mills around only to balk at the cost of upfitting them. Parkdale ended up buying those mills, giving it captive accounts.

The days of one- or two-plant yarn-spinning companies are over, and bigger makes Parkdale better, Kimbrell says. "Customers today rather than having five or six suppliers would rather have two or three. You've got to have volume to do it."

The deal that pushed Parkdale up from No. 5 on last year's list closed in July 1997 -- a joint venture with the yarn-spinning operations of Greensboro-based Unifi Inc. Parkdale now owns 64% of Parkdale America Inc., a Parkdale subsidiary run by Parkdale managers. Unifi, which sticks to texturizing polyester and nylon, owns the balance -- for the time being. "We'll probably end up buying the rest in time," Kimbrell says, "but it saved me putting up that much cash at once." The company is now by far the largest yarn maker in the country. Its largest competitor, Monroe, Ga.-based Avondale Mills Inc., is only a third Parkdale's size.

Kimbrell managed four of the six Unifi mills once before, along with fellow textile execs Gene Gwaltney and Dalton McMichael. They started them as Vintage Yarns Inc. in 1982, separate from Parkdale. Kimbrell and members of the founding Henry family used a leveraged buyout to take ownership of Parkdale that year. Kimbrell figured only one company was stable enough and knew the industry well enough to be interested in Vintage. "I never in my wildest dreams thought Vintage would go anywhere except for Parkdale." So he treated the mills like a long-term investment. "Never took a dime out of them, and every time we'd get enough business, we'd expand."

They caught the attention of Unifi executives. "One reason Unifi wanted in is they thought we were making that much money," Kimbrell says. "If you're private enough, people get to thinking how much money you're making. If no one can find out, it always grows. It gets exaggerated." In 1993, publicly traded Unifi paid $279 million in stock for the mills. It took Unifi just four years to realize yarn spinning wasn't easy or that profitable. It turned them back over to Kimbrell, through Parkdale.

Kimbrell and his heir apparent, his son-in-law and Parkdale's president and chief operating officer, Andy Warlick, set about fixing the mills. They closed one and had the others making money within eight months -- longer than they planned because Parkdale promised not to lay off any production workers. "We backed up three months because attrition didn't set in as quick as we thought it would," Kimbrell says. That was even after he and Warlick switched the mills from eight-hour to 12-hour shifts, figuring, incorrectly, that would drive off some employees.