Bed Bath & Beyond Stops Selling Welspun Egypt Cotton Sheets

(Bloomberg) -- Bed Bath & Beyond Inc. is no longer selling Welspun India Ltd. sheets that were labeled as 100 percent Egyptian cotton, dealing another setback to a bedding supplier embroiled in a scandal about the origin of its products.

Based on an independent audit of Welspun’s Perfect Touch and Crowning Touch sheets, the Indian supplier wasn’t able to guarantee that the fibers were actually Egyptian cotton. That led Bed Bath & Beyond to stop selling the sheets, spokeswoman Leah Drill said in an e-mail.

“We are extremely disappointed in these findings,” Drill said. “While the sheets are safe to use, as with any product we sell, customers who are dissatisfied can return the sheets to any one of our stores for a refund or store credit. ”

Welspun shares fell as much as 9.4 percent in Mumbai on Tuesday. The Indian company said it will continue its business relationship with Bed Bath & Beyond.

The move follows Target Corp.’s announcement in August that it was severing ties with Welspun. Target said at the time that 750,000 sheets and pillowcases that were labeled as Egyptian cotton were actually made with another type of cotton, kicking off a controversy that has reverberated through the industry. Wal-Mart Stores Inc. also stopped selling Welspun’s Egyptian-cotton sheets over concerns about the products’ origin.

Consumers often pay a premium for Egyptian-cotton products because they’re perceived to be softer and more durable. Sheets made from cotton grown in other countries don’t always carry the same cachet.

To contact the reporter on this story: Shannon Pettypiece in New York at spettypiece@bloomberg.net. To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Kevin Orland