Irving Tanning files for Chapter 11

Worldwide shortages and the increase in hide prices were reasons given by Irving Tanning for filing for protection under Chapter 11 of the US Bankruptcy Code which provides time and opportunity to restructure debts or obtain new investment capital. Their plant in Hartland will remain open and IBP have agreed to continue to supply hides. Hartland employs 385 but 20 are being laid-off as part of cost-cutting exercises. Irving have annual sales of $100 million, around 50% of which are overseas. However, the company have been experiencing cash flow problems due to difficulties in the tanning industry in general and the increasing global hide shortage resulting in steep increases in raw material costs. According to Irving's statement, the US kill is down 7% due to economic conditions and the severe winter. The European kill is reported to be 50% down due to BSE and foot and mouth and South America and New Zealand are also experiencing difficulties. They say hide prices are at an historical high, up more than 50% in the past months. Added to this US based footwear manufacturing has seen a continuous decline with most shoe factories relocating to Asia. Imports in the US now account for 97% of total retail sales.