Yarn producer RL Stowe Mills Inc is to close after nearly 108 years, blaming a sudden and dramatic decline in business in its fourth quarter.

The North Carolina based firm, which makes cotton ring spun and open end yarns for weaving, knitting and specialty applications, employs around 550 people in four plants.

President and CEO Harding Stowe said in a statement that "business conditions in the fourth quarter deteriorated suddenly and dramatically."

He added: "Looking forward, management does not see sales returning to levels sufficient to sustain business."