Stikeman representing Gildan; Blakes acting for HanesBrands
Gildan Activewear Inc., a Montréal-based apparel manufacturer, has announced its largest acquisition to date with an agreement to purchase U.S.-based HanesBrands Inc. The transaction values HanesBrands’ equity at approximately US$2.2 billion and the total enterprise at US$4.4 billion, including debt. The deal, unanimously approved by both boards, will create one of the world’s largest basic apparel companies.
Stikeman Elliott LLP and Sullivan & Cromwell LLP are acting as legal counsel for Gildan, while Blake, Cassels & Graydon LLP and Jones Day are representing HanesBrands. On the financial side, Morgan Stanley & Co. LLC and CIBC Capital Markets are advising Gildan, while Goldman Sachs & Co. LLC is the lead financial advisor to HanesBrands, with Evercore also advising.
Under the terms of the agreement, HanesBrands shareholders will receive a combination of Gildan shares and US$0.80 in cash for each HanesBrands share, representing a 24 percent premium over HanesBrands’ share price before the deal was announced. Upon closing, HanesBrands shareholders will own approximately 19.9 percent of the combined company.
The merger is expected to close by early 2026, pending regulatory and shareholder approvals. Gildan will maintain its headquarters in Montréal, Quebec, and HanesBrands will continue to have a strong presence in Winston-Salem, North Carolina.
The combined company will offer a broader range of products, including well-known brands in both activewear and innerwear. Gildan expects the deal to generate at least US$200 million in annual cost savings within three years, primarily by streamlining manufacturing and operations.
“With this transaction, our revenues will double and we achieve a scale that distinctly sets us apart,” said Gildan president and CEO Glenn J. Chamandy in a press release. “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. Further, our state of the art low-cost vertically integrated platform will be utilized to enhance efficiencies and drive additional innovation.”
HanesBrands CEO Steve Bratspies added, “We have great respect for Gildan’s manufacturing strength and long track record of success. We look forward to expanding upon HanesBrands’ portfolio of leading innerwear brands and go-to-market expertise and opening new doors for growth and impact as part of Gildan.”
To finance the acquisition and refinance HanesBrands’ existing debt, Gildan has secured US$2.3 billion in committed financing. The company has stated it will focus on reducing its debt after the deal closes.
The deal is expected to have a significant impact on the North American apparel industry, expanding Gildan’s product offerings and global reach, while also providing HanesBrands shareholders an opportunity to participate in the growth of the combined company.
