Canadian apparel company Gildan Activewear (NYSE:GIL) has finalized the acquisition of Hanesbrands (NYSE:HBI) in a transaction valued at $4.4 billion, including debt, marking the largest deal in Gildan’s history. The agreement, structured as a $2.2 billion combination of cash and stock, sets the purchase price at roughly $6 per share—a 24% premium over Hanesbrands’ closing price on August 11. After the deal closes, former Hanesbrands shareholders will hold about 19.9% of Gildan.
The merger is designed to nearly double Gildan’s revenue and deliver at least $200 million in annual synergies within three years. Analysts expect the impact on adjusted earnings per share to be immediately positive, with growth projected to exceed 20% once synergies are fully realized.
To fund the acquisition, Gildan has arranged $2.3 billion in financing, consisting of a $1.2 billion bridge credit facility and $1.1 billion in term loans. The company will also refinance approximately $2 billion of Hanesbrands’ existing debt.
Hanesbrands, which recently sold its Champion brand for $1.2 billion, had been contending with declining sales and tariffs affecting 75% of its revenue. Despite these challenges, the company beat profit expectations in the second quarter and raised its full-year outlook.
The combined entity is expected to strengthen Gildan’s position in the underwear and sportswear markets by leveraging Gildan’s vertically integrated production network alongside Hanesbrands’ established brand recognition. The headquarters will remain in Montreal, with operations continuing in Winston-Salem, North Carolina.
Gildan anticipates its net leverage ratio will decline to 2.0x adjusted EBITDA within 18 months of closing. The transaction is still subject to regulatory and shareholder approvals and is expected to be completed in late 2025 or early 2026.
Following the announcement, Hanesbrands’ shares fell 5%, while Gildan’s stock declined 1.6% in pre-market trading on Wednesday, August 13.
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