ShareThis Page
Business Headlines

Indian textile maker's sheets under scrutiny

| Thursday, Aug. 25, 2016, 11:00 p.m.

NEW YORK — U.S. retailers including J.C. Penney and Wal-Mart are scrutinizing whether sheets Welspun India Ltd. said were high-end Egyptian cotton were in fact cheaper knock-offs, a question that has sent the textile company's shares plunging.

Since Target announced Friday that it was pulling the sheets from its stores and online and was terminating its relationship with the company, other retailers have launched investigations into the certification claims from Welspun, one of India's largest textile makers.

Target said an investigation confirmed that Welspun used another type of non-Egyptian cotton between August 2014 and July, and the retailer is offering refunds to its RedCard and Target.com customers who bought the sheets during that time. Target declined to say what spurred its investigation.

Welspun told investors this week it's conducting an audit. It said in a conference call that the product in question with Target accounts for about 1 percent of the textile company's sales.

Welspun's shares have fallen more than 40 percent since Friday on the BSE, the largest exchange in India, and were down 8 percent Thursday.

Wal-Mart spokeswoman Marilee McInnis said Welspun supplies the retailer with a number of products, including some of the sheets. She said Wal-Mart is reviewing Welspun's certification records and plans to have “additional conversations” with the company.

Bed, Bath & Beyond said it is working with an independent third party to audit the supply chain and will “aggressively pursue its investigation and take appropriate action, if needed.” Penney said it was too early in its review to determine what actions may be necessary.

Macy's said Welspun produces some of the chain's private-brand products but they are not involved in this situation because they are not marketed as 100 percent Egyptian cotton. But it said it is monitoring developments.

TribLIVE commenting policy

You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.

click me