HanesBrands is set to be acquired by Gildan for a staggering $2.2 billion.
In a significant move, Gildan Activewear has announced its intention to acquire HanesBrands for an equity value of approximately $2.2 billion. This deal, set to close by the end of 2025 or early 2026, subject to customary closing conditions, promises to reshape the apparel industry landscape.
Financial Implications for HanesBrands Shareholders
Under the terms of the agreement, HanesBrands shareholders will receive a combination of cash and Gildan common shares as consideration. Specifically, each HanesBrands share will be exchanged for 0.102 common shares of Gildan plus $0.80 in cash. This equates to an approximate transaction value of $6 per HanesBrands share, representing a 24% premium on HanesBrands' stock price prior to the deal announcement.
| Aspect | Details | |----------------------------|------------------------------------------------------| | Acquisition price per share| ~$6.00 per HanesBrands share | | Consideration mix | 0.102 Gildan shares + $0.80 cash per HanesBrands share | | Premium on pre-deal share price | Approximately 24% | | Total equity value | ~$2.2 billion | | Enterprise value | ~$4.4 billion (includes debt) | | Cash portion of deal | About $290 million (13% of consideration) | | Ownership in combined firm | HanesBrands shareholders own ~19.9% of Gildan shares |
The cash portion of the deal amounts to about $290 million, with the remaining consideration paid in shares, making the deal roughly 87% stock and 13% cash for HanesBrands shareholders. Upon completion, HanesBrands shareholders will own approximately 19.9% of Gildan's outstanding shares, indicating they will become significant minority shareholders in the combined company.
Growth Opportunities and Synergies
The merger presents an opportunity to develop the iconic Hanes brand and leverages operational synergies, expand brand presence, and enhance long-term shareholder value. The combined entity aims to double Gildan's revenues and create a global leader in basic apparel.
"This transaction not only provides immediate cash and ownership upside for HanesBrands shareholders but also positions them to benefit from the combined entity’s growth," said Glenn Chamandy, President and CEO of Gildan. The merger strengthens the company's position, positioning it for enhanced scale and efficiencies.
The transaction is subject to the approval of HanesBrands shareholders. If approved, this deal effectively converts HanesBrands shareholders from owners of an independent firm into significant shareholders of a larger combined apparel company.
The acquisition of HanesBrands by Gildan Activewear will provide HanesBrands shareholders with a mix of cash and Gildan common shares as consideration, amounting to approximately 19.9% ownership of Gildan's outstanding shares, making them significant minority shareholders in the combined company.
The merger presents growth opportunities for the combined entity, as it aims to double Gildan's revenues, develop the iconic Hanes brand, and leverage operational synergies, ultimately positioning itself as a global leader in basic apparel.
