The business began as two separate companies: J & J Baldwin and Partners, founded in the late 1770s by James Baldwin of Halifax, West Yorkshire, England, and John Paton Son and Co., founded in 1814 by John Paton of Alloa, Scotland.

The Paton family were regarded as generous benefactors in the town of Alloa, where they provided funding for a significant range of public building projects, including Alloa Town Hall, public libraries, a school, a swimming pool, and a gymnasium.

The two companies merged in 1920 and diversified into producing wool for home knitters, as well as publishing knitting patterns under the "Patons Rose" and "Baldwins Beehive" trademarks.

The company branched out into various related lines of business, including the running of an angora rabbit farm in Staffordshire between 1932 and 1934,[2] and the development of new products such as nylon and Terylene.

[1] In 1951, the headquarters of the business was relocated from Spring Hall, Halifax to a 140-acre site in Darlington, County Durham, where a single-storey factory employing 4,000 people was developed at a cost of £7.5 million.