HanesBrands to be acquired by Gildan Activewear for a value of $2.2 billion
In a significant move, Gildan Activewear has announced plans to merge with HanesBrands in a deal valued at $4.4 billion. The transaction, expected to close in late 2025 or early 2026, will see Gildan acquiring HanesBrands for $2.2 billion, with the remainder in stock.
The deal, which consists of 87% stock and 13% cash per every HanesBrands share, comes after a tumultuous period for both companies. Gildan's former CEO, Glenn Chamandy, was fired in late 2023 and reinstated after a proxy battle and a complete board turnover.
For Gildan, the merger is a strategic move to expand its presence. The company will maintain its headquarters in Montreal, but will have a "strong presence" in Winston-Salem, North Carolina, where HanesBrands is based. Gildan's activewear segment has been growing, with a 12% increase for the period, but its hosiery and underwear category has seen a decline of about 23%. The underwear segment, however, represents only about 10% of Gildan's total revenue.
Chamandy, in a statement, expressed his belief that the combination will double Gildan's revenue. He emphasised that the merger will create a stronger, more diversified company with a broader product portfolio.
HanesBrands, on the other hand, has been focusing on gaining market share in the category. The company, which was spun out from the Sara Lee Corporation in 2006 and has been an independent company since, was able to pay down a significant amount of debt last year by selling Champion. Despite this, HanesBrands's most recent revenue results came in below expectations at $991 million for the second quarter, a 1.8% increase year over year.
In the wake of the merger, Gildan intends to "initiate a review of strategic alternatives for HanesBrands Australia," which could include a sale or other transaction. This move is aimed at optimising the combined company's global footprint and resources.
The merger was reportedly one of the reasons for Chamandy's initial dismissal, as he had shown interest in a deal with HanesBrands, as reported by Bloomberg. However, the board's decision was ultimately reversed following the proxy battle and the complete board turnover.
The cash portion of the deal is anticipated to be about $290 million. Gildan will pay for HanesBrands through $2.3 billion in transaction financing. The combined company, with its diverse product portfolio and expanded global reach, is poised to take on the challenges and opportunities in the ever-evolving apparel industry.
Read also:
- Understanding Hemorrhagic Gastroenteritis: Key Facts
- Trump's Policies: Tariffs, AI, Surveillance, and Possible Martial Law
- Expanded Community Health Involvement by CK Birla Hospitals, Jaipur, Maintained Through Consistent Outreach Programs Across Rajasthan
- Abdominal Fat Accumulation: Causes and Strategies for Reduction
