Engineered Floors to buy beleaguered Beaulieu Group

Worker Mathew Ferney works on a tufting machine Tuesday, June 17, 2014, at a Beaulieu of America factory in Dalton, Ga.

Top U.S. flooring makers

2016 rank and U.S. sales:1. Mohawk Industries — $4.8 billion2. Shaw Industries — $3.9 billion3. Armstrong — $985 million4. Tarkett — $833 million5. Mannington — $785 million6. Engineered Floors — $659 million7. Interface — $498 million8. Beaulieu of America — $479 million9. The Dixie Group — $394 million10. Maples — $220 millionSource: Floor Focus magazine and Market Insights LLC

Engineered Floors, the floorcovering company started just eight years ago by carpet pioneer Bob Shaw, could climb to No. 3 in industry sales after an agreement to buy competitor Beaulieu Group.

The Dalton, Ga.-based manufacturer announced Wednesday it has a letter of agreement to buy substantially all of the operating assets of Beaulieu, which sought Chapter 11 bankruptcy protection in July.

The transaction is contingent upon approvals through the bankruptcy court and due diligence processes, according to Engineered Floors. Pending governmental approvals, the deal is expected to close in the fourth quarter of this year.

photo Staff File Photo by Angela Lewis/ Bob Shaw, head of Engineered Floors, talks about the carpet industry in a prior interview.

Both carpet companies are privately held and a purchase price wasn't announced.

Ken Ryan, senior editor of Floorcovering News, said Shaw "continues to amaze in his retirement years," citing the carpet executive who's in his mid-80s.

"He's one of a kind," Ryan said.

Beaulieu, also based in Dalton, said in a statement that officials "believe this opportunity provides the best course for the company and its employees, customers and vendors."

Ryan said Engineered Floors does well on lower-end products while Beaulieu occupies the higher-end space.

"It could be a nice fit for Engineered Floors," he said about the company that has facilities in Dalton and Calhoun, Ga.

Ryan said he believes the Beaulieu name will be retained if the deal closes.

"Beaulieu is a legacy brand," he said. "It still has tremendous equity in the flooring industry."

Ryan said he's hopeful that Engineered Floors, which employs about 3,000 people, will retain most of Beaulieu's more than 2,500 employees.

"It's providing a lifeline for Beaulieu's people," he said. "I think [Bob Shaw] is very sensitive to that."

The combination of the two companies and their 2016 sales would top $1 billion, according to Floor Focus magazine. Engineered Floors at No. 6 in sales combined with No. 8 Beaulieu would catapult Engineered Floors to No. 3 behind flooring leader Mohawk Industries and Shaw Industries, according to the magazine's figures.

Late in 2015, Engineered Floors unveiled plans to merge with J&J Industries, a 60-year-old family company that specialized in commercial carpet.

Engineered Floors in the past had been a residential carpet maker and its acquisition of J&J gave it entry into the commercial end of the business.

Shaw, who started Shaw Industries decades ago, later sold it to billionaire Warren Buffett's Berkshire Hathaway before starting Engineered Floors in 2009.

Beaulieu, amid falling sales and stiffening competition, in July filed for bankruptcy as the business sought to restructure.

Michael Pollard, Beaulieu Group's president, said then the bankruptcy filing was "a necessary process as we continue to execute our long-term strategic plans for the business."

"Our business model has changed with the industry and our client base since our current capital structure was put into place," he said.

Engineered Floors officials declined further comment.

Contact Mike Pare at or 423-757-6318.

photo In this 2011 staff file photo, Steve Livingston works to line level a twister machine in an Engineered Floors facility in Dalton, Ga.