Seamless intimate apparel maker Tefron Ltd on Wednesday announced plans to shift manufacturing for the consumer division of its wholly-owned subsidiary Alba-Waldensian to Israel to save up to $6 million a year.

The Bnei-Brak-based company, which makes underwear for leading brands such as Victoria's Secret, Gap, Target, Nike and Adidas, said marketing and distribution of the consumer division will remain in the US and be consolidated with the rest of the group.

As a result of the action at the North Carolina facility, Tefron will report a one-time charge in the fourth quarter of 2002 of around $6m.

The company did not say how many employees would be affected by the move which will take place in the first quarter of 2003.

Tefron previously announced it was continuing to reorganise Alba-Waldensian subsequent to forming a joint venture with its new strategic US partners for its health product division.

CEO Yos Shiran said: "In continuation of our reorganisation plan and the significant improvement in Tefron's operating income in the past year, we continue to work toward further improvement.

"Consolidating Alba's production with Hi-Tex (in Israel) will give us an advantage of 'economy of scale' and will enable us to utilise Hi-Tex's higher efficiency.

"This, together with Hi-Tex technological capabilities will result in a significant improve of the efficiencies and cost savings for the company."