Bedding firm Dunlopillo goes into liquidation

The maker of Dunlopillo pillows and bedding went into administration today after falling victim to soaring costs and its failure to secure vital funding.

Dunlop Latex Foam, based in Pannal, near Harrogate in England, was placed in administration despite efforts by a recently appointed management team to turn the business around.

Around 155 jobs are now at risk at the group, although administrator KPMG said it hoped to secure the sale of Dunlop as a going concern.

Dunlop trades as Dunlopillo International, but in the UK and Ireland the Dunlopillo trademark is owned by Hilding Anders, Europe’s largest bed manufacturer.

Howard Smith, joint administrator, said: “Dunlopillo is one of the few truly worldwide brands in the sector that is immediately recognisable to the customer.

“We are continuing to trade the company while discussions take place with both external investors and trade buyers in an attempt to secure a going concern sale.”

Dunlop had funding in place to relocate some of the business overseas, but the deal fell through when the group was unable to resolve an outstanding pension fund deficit.

It had already been struggling against soaring raw material costs and energy bills, while the economic slowdown had hit consumer demand for its products, according to KMPG.

The company had been bought by existing investors in 2007 when a new management team was hired to lead a revival plan.

An overhaul was launched earlier this year, which had seen the group trade profitably for the first seven months, with operating profits of £400,000 (€492,000) compared to losses of £100,000 (€123,000) last year.

However, KMPG said the withdrawal of the funding deal and other pressures had “served to undermine the turnaround strategy”.

Dunlop makes latex foam pillows, blocks and sheeting for the bedding market globally.

The Dunlopillo brand was launched in 1926, although the latex material was invented three years later.

It was taken private in 1997 after a private equity-backed management buyout, with the UK and Ireland consumer business and brand sold to Swedish bed and bedding firm Hilding Anders in 2002.