Luggage-maker Samsonite Corp., a Colorado-based company for nearly a century, said Wednesday it will close its U.S. headquarters in Denver by the end of next year.
Samsonite employs about 265 people at its Denver facility, near Interstate 70 and Peoria Street. It has a distribution center here and some corporate functions, though most decisionmaking has been by top executives in Belgium for nearly a decade.
“It’s devastating. It’s sad,” said Sherry Fairow, 32, manager of the Samsonite retail store near the headquarters. “People are concerned. There are a lot of questions that haven’t been answered.”
Samsonite said it plans to move the Denver functions to its Mansfield, Mass., office and to a distribution facility in the southeastern U.S. that was not identified. Officials said some of the 265 workers will be offered transfers.
“This decision has been a particularly difficult one to make in that Samsonite originally began its operations in Denver in 1910,” Marcello Bottoli, president and chief executive, said in a statement.
Bottoli was on site Wednesday to make the announcement, several employees said. Before his appointment as Samsonite’s chief two years ago, Bottoli was president and CEO of luxury bagmaker Louis Vuitton.
Samsonite brands include American Tourister.
The closure in Denver comes as Samsonite struggles to regain its footing after a long period of declining sales in the United States and financial struggles.
One of the world’s most well-known luggage-makers, Samsonite was about three weeks away from a major refinancing deal when terrorists struck New York and the nation’s capital in 2001. All of Samsonite’s lenders pulled back.
What followed was a nearly two-year scramble to protect the company best known for its advertising campaign featuring a luggage-beating gorilla.
Samsonite executives knew they would be hurt by a devastating slump in the travel industry and a desperate need for cash.
The company’s struggling share price caused its move from the Nasdaq National Market to the over-the-counter bulletin board in 2002. Shares of Samsonite closed Wednesday unchanged at $1.10. Samsonite has a market capitalization of $250 million.
The company in May restated its financial performance by $6 million between 2003 and 2005 after Samsonite disclosed “incorrect use of deferred tax liabilities.” It also recently announced plans to close a European production plant.
Samsonite’s U.S. sales have waned in recent years as consumers shifted from hard-sided luggage, for which Samsonite was known, to more supple, soft-sided offerings. Though Samsonite has a 96-year affiliation with Denver, the city has played a diminishing role in its operations over the past few decades.
Founded in Denver in 1910 by Jesse Shwayder, the company was first called Shwayder Trunk Manufacturing and later renamed Shwayder Brothers Inc. The company became Samsonite in 1965, taking the moniker from its popular suitcase named after the biblical strongman Samson.
The Shwayder family sold the company to Beatrice Foods in 1973, and the company has since switched hands several times and struggled with changing tastes in luggage.
The company appointed Luc Van Nevel, a Belgian and veteran of its overseas operations, as chief executive in 1998. He ran the company from its European headquarters in Belgium. Europe has been Samsonite’s biggest market, accounting for 43 percent of sales last year, while U.S. sales fell to 38 percent. Sales in Asia have grown to 17.5 percent.
Samsonite shuttered its manufacturing plant in Denver’s Montbello neighborhood in May 2001, resulting in 340 job cuts.
In 2005, Samsonite sold its 100-acre Montbello campus to Panattoni Development Co., based in Sacramento, for $14.2 million. It continued to lease two buildings on the campus.
The Associated Press contributed to this report.
A 96-year journey in Colorado
March 1910: Jesse Shwayder founds Shwayder Trunk Manufacturing in Denver. He and his four brothers run the company, which later becomes Shwayder Brothers Inc.
April 1965: The company officially becomes Samsonite Corp.
April 1966: Samsonite breaks ground on a six-building manufacturing complex in Denver’s Montbello neighborhood.
July 1968: “World’s largest” luggage assembly plant opens in Montbello.
August 1973: The company becomes part of the Beatrice Foods conglomerate.
Summer 1987: Beatrice spins off E-II Holdings Inc., which becomes the new parent company of Samsonite.
About March 1988: American Brands, a tobacco and consumer-products company in Connecticut, acquires Samsonite and three other companies when it purchases E-II.
June 1988: Samsonite parent E-II is sold to the Riklis Family Corp.
July 1992: E-II Holdings Inc. files for Chapter 11 bankruptcy protection.
June 1993: E-II emerges from bankruptcy and changes its name to Astrum International Corp.
August 1993: Astrum announces a plan to acquire American Tourister.
April 1995: Astrum splits into two companies: Samsonite Inc. and Culligan Water Technologies.
May 2001: Samsonite closes its Denver plant, which once employed as many as 4,000 people in the 1960s and 1970s. The closure, with operations moved to other countries, results in 340 lost jobs here.
January 2002: Samsonite Corp. ceases trading on Nasdaq and moves to the OTC Bulletin Board.
March 2004: Marcello Bottoli, formerly president and CEO of luxury bagmaker Louis Vuitton, is appointed president and CEO.
March 2005: Samsonite sells its 100-acre campus in Montbello to a California developer for $14.2 million.
Wednesday: Samsonite announces it will close its Denver facilities – which employ 265 people – by the end of 2007.
Sources: Denver Post research, Samsonite
