Canadian apparel manufacturer Gildan Activewear has signed a definitive merger agreement to acquire US apparel brandHanesBrands for an enterprise value of $4.4bn.
The transaction will combine the strengths of both companies to create what is described as a “global basic apparel leader”.
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The merger will expand Gildan’s scale and strengthen its market positioning, combining its activewear leadership with HanesBrands’ innerwear retail expertise.
Gildan president and CEO Glenn Chamandy stated: “With this transaction, our revenues will double and we achieve a scale that distinctly sets us apart. The combination with HanesBrands strengthens our positioning with an opportunity to expand the heritage Hanes brand presence in activewear across channels, while enhancing Gildan’s retail reach for its portfolio of brands.”
Gildan’s headquarters will remain in Montréal, Québec, with a combined presence in Winston-Salem, North Carolina.
HanesBrands shareholders will receive 0.102 common shares of Gildan and $0.80 in cash for each share of HanesBrands stock, owning 19.9% of Gildan shares post-transaction.
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By GlobalDataThe transaction, subject to shareholder and regulatory approvals, is expected to close between late 2025 and early 2026.
The combined company will benefit from enhanced product diversification, an advanced low-cost manufacturing network and significant synergy opportunities, with at least $200m in annual cost synergies expected by 2028.
Gildan has obtained $2.3bn of committed financing for the acquisition and anticipates a net debt leverage ratio of 2.6 times adjusted earnings before interest, taxes, depreciation and amortisation at closing.
Gildan has reaffirmed its full-year 2025 revenue and earnings per share guidance and provided a three-year outlook for 2026 to 2028, anticipating 3% to 5% net sales growth, 3% to 4% capital expenditures annually to support growth and vertical integration, and enhanced shareholder returns.
HanesBrands board of directors chairman Bill Simon stated: “As part of Gildan, HanesBrands will benefit from an even stronger financial and operational foundation that will provide new growth opportunities – helping to power further innovation, a broader product offering and greater reach across channels and geographies. We are confident that this transaction and the next chapter with Gildan is the right next step for HanesBrands and will honour and build on its long history for the benefit of all our stakeholders.”
Morgan Stanley & Co and CIBC Capital Markets acted as financial advisors to Gildan while Sullivan & Cromwell and Stikeman Elliott as legal advisors.
Goldman Sachs & Co and Evercore served as lead financial advisors to Hanesbrands, and Jones Day and Blake, Cassels & Graydon were legal advisors.
