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Kitan factory in Dimona Photo: Roee Idan
Kitan factory in Dimona Photo: Roee Idan
 
 

Kitan shuts down Dimona factory

Textile company's southern facility, which in its heyday employed 2,000 people, has been in the red for several years now, struggling with losses estimated at tens of millions of shekels

Gil Kalian, Calcalist
Published: 12.03.12, 07:54 / Israel Business

The southern town of Dimona is seeing some sad history: The Kitan factory, which has been spinning out textile products since 1958, has announced it would shut down after years of losses estimated at tens of millions of shekels.

 

In its heyday, Kitan Dimona, which was a one-stop shop for textile manufacturing and printing, had about 2,000 employees. Recently the factory remained with only 40 workers and deals exclusively with textile curing.

 

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The machines at Kitan were kept running until now under the auspices of former owner Nochi Dankner, who has sold off his holdings in Kitan's parent company, Clal Holdings, to Len Blavatnik.

 

Last week, IDB Holdings reported it had received the last payment for Clal from Blavatnik, which signaled the demise of Kitan's textile factory.

 

Kitan is just one textile maker in a long list of Israeli fashion companies that have chosen to outsource their manufacturing to cheaper overseas manufacturers on order to streamline costs.

 

Kitan operates 24 retail textile stores in Israel, and plans to further expand its retail activity by three to five stores each year.

 

Kitan also holds the license for Esprit products in Europe, Canada and Mexico, and plans to expand to other countries as well.

 

The company has an annual turnover of NIS 170 million (about $45 million) and is currently unprofitable. Shutting down the factory will cut Kitan's losses but is far from enough to lead the company to gains.

 

This report wasoriginally published in Hebrew by Calcalist

 

 

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