Gildan Activewear Inc. closed its definitive agreement to acquire HanesBrands Inc. for an enterprise value of approximately $4.4 billion, with an equity value of about $2.2 billion, on December 1 2025. The deal, first announced on August 13 2025, brings HanesBrands’ iconic brands—Hanes, Champion, Playtex, Bali, L’eggs, Maidenform, and Bonds—into Gildan’s vertically integrated, low‑cost manufacturing platform, effectively doubling the combined company’s scale and expanding its product mix across activewear, innerwear, and lifestyle apparel.
The strategic rationale behind the merger is to combine Gildan’s manufacturing efficiency and activewear expertise with HanesBrands’ strong retail presence and well‑known innerwear brands. By integrating the two companies, the combined entity will become the world’s largest basic apparel company, with a broader geographic reach and a more diversified channel mix. The transaction also positions the company to leverage cross‑channel sales and enhance innovation capabilities across the expanded portfolio.
Financially, Gildan expects to generate run‑rate cost synergies of at least $200 million within three years of closing, and the deal is projected to be immediately accretive to Gildan’s adjusted diluted earnings per share, with a pro‑forma accretion of over 20%. Prior to the acquisition, Gildan reported Q3 2025 net sales of $911 million and an EPS of $1.00, slightly beating analyst expectations of $0.99. HanesBrands, on the other hand, had a net income of $417 million on revenue of $891.7 million, a P/E ratio of 5.58, and a debt load of roughly $2.5 billion, reflecting the financial pressures that led to the sale.
The sale was driven by HanesBrands’ declining sales, heavy debt burden, and tariff impacts that eroded profitability. Gildan sees an opportunity to refinance HanesBrands’ debt and integrate its operations to achieve scale efficiencies and cost savings. The combination also allows Gildan to broaden its brand portfolio, adding high‑margin innerwear brands to its existing activewear lineup and creating new cross‑selling opportunities.
Management emphasized the strategic fit and integration focus. Gildan CEO Glenn Chamandy said, “Today marks the beginning of an exciting new chapter. By welcoming HanesBrands into the Gildan family, we are doubling our scale, combining iconic brands with our world‑class, low‑cost, vertically integrated platform, and unlocking a powerful engine for innovation and growth.” HanesBrands CEO Steve Bratspies added, “This transaction represents a powerful alignment of our shared commitment to quality, innovation, and excellence. 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.”
Analysts responded positively to the announcement, upgrading coverage and raising price targets across the board. RBC Capital, CIBC, Scotiabank, TD Securities, and UBS all increased their targets, citing the strategic fit, expected cost synergies, and the accretive impact on earnings. The market reaction was driven by the combination’s potential to create a dominant global player with a diversified brand portfolio and significant cost advantages.
The deal positions the combined entity as a dominant player in the global basic apparel market, with enhanced capabilities in both activewear and innerwear. Integration will focus on seamless collaboration, leveraging Gildan’s manufacturing strengths and HanesBrands’ retail expertise. Antitrust concerns are expected to be addressed, and the transaction is anticipated to receive regulatory clearance, allowing the combined company to pursue its growth strategy without significant operational disruptions.
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