Gildan Activewear to Acquire HanesBrands in US$4.4B Apparel Mega-Merger
In a move that promises to reshape the global apparel industry, Montreal-based Gildan Activewear has announced a landmark agreement to acquire HanesBrands, a U.S.-based leader in everyday apparel, in a deal valued at $4.4 billion. This transaction, which includes $2.2 billion in cash and stock, marks the largest acquisition in Gildan’s history and positions the combined entity as a powerhouse in basic apparel, including T-shirts, socks, underwear, and activewear.
The deal, expected to close in late 2025 or early 2026, is subject to HanesBrands shareholder approval and customary closing conditions. Under the terms, HanesBrands shareholders will receive approximately 19.9% of Gildan shares on a non-diluted basis, with the offered price of $6 per share representing a 24% premium to HanesBrands’ closing price prior to the announcement. This acquisition is projected to double Gildan’s annual revenues, with combined sales anticipated to exceed $6 billion post-merger.
The strategic rationale behind the merger is clear: Gildan’s vertically integrated, low-cost manufacturing platform will complement HanesBrands’ strong retail brand presence, creating a more efficient and innovative global operation. HanesBrands’ manufacturing focus on U.S. cotton and Central America further enhances supply chain stability, offering a competitive edge over companies reliant on Asian production. The merger is expected to yield at least $200 million in annual cost synergies within three years of closing.
The acquisition is poised to have an immediate positive impact on Gildan’s adjusted per-share earnings. The company plans to expand the Hanes heritage brand within activewear while broadening the retail presence of its own brands. HanesBrands, which recently sold assets like Champion for $1.2 billion to manage debt, brings financial stability and growth opportunities to the table.
Both companies share a strong commitment to supply chain reliability, sustainability, and product innovation, positioning the merged entity to address evolving industry needs and capitalize on new market opportunities. Industry leaders have praised the deal, highlighting the synergy between Gildan’s manufacturing strengths and Hanes’ brand power, which could bring “fresh ideas, enhanced products, and new opportunities for growth.”
Looking ahead, Gildan has issued a three-year outlook for 2026–2028, projecting net sales growth at a compound annual growth rate (CAGR) of 3% to 5% post-acquisition. The company remains focused on supporting customers and driving long-term shareholder value. With this acquisition, Gildan is set to emerge as a global leader in affordable, everyday apparel, combining enhanced scale, production efficiencies, and a diverse brand portfolio to drive growth and innovation in the years to come.
Strategic Synergies and Financial Implications
The acquisition of HanesBrands by Gildan Activewear is expected to create significant strategic synergies, particularly in manufacturing and brand portfolio expansion. Gildan’s vertically integrated, low-cost manufacturing platform will be complemented by HanesBrands’ strong retail brand presence, enabling the combined entity to enhance operational efficiencies and drive innovation. This integration is anticipated to yield at least $200 million in annual cost synergies within three years of closing, primarily through optimized production processes and streamlined supply chains.
From a financial standpoint, the deal is structured to provide immediate stability and growth opportunities. HanesBrands shareholders will receive approximately 19.9% of Gildan shares on a non-diluted basis, with the offered price of $6 per share representing a 24% premium to HanesBrands’ closing price prior to the announcement. This transaction is expected to double Gildan’s annual revenues, with combined sales projected to surpass $6 billion post-merger. The deal is subject to HanesBrands shareholder approval and customary closing conditions, with an expected closing date in late 2025 or early 2026.
Market Expansion and Brand Portfolio
The merger is poised to significantly expand the combined company’s market reach and brand portfolio. Gildan plans to leverage HanesBrands’ iconic heritage brands to strengthen its position in the activewear market, while also broadening the retail presence of its own brands. This dual approach is expected to enhance the company’s competitive position in the global apparel industry, particularly in the basic apparel segment, which includes T-shirts, socks, underwear, and activewear.
HanesBrands, which has recently divested assets such as Champion for $1.2 billion to manage debt, brings a strong portfolio of brands and a solid financial foundation to the merger. The deal is expected to provide HanesBrands with increased financial stability and growth opportunities, while also enabling Gildan to further diversify its product offerings and expand its global footprint.
Sustainability and Supply Chain Resilience
Sustainability and supply chain reliability are key focus areas for both Gildan and HanesBrands, and the merger is expected to further strengthen these commitments. The combined entity will leverage Gildan’s vertically integrated manufacturing platform and HanesBrands’ expertise in sustainable practices to drive innovation and reduce environmental impact. Both companies have a strong track record of prioritizing supply chain reliability, which is expected to be further enhanced through the merger.
HanesBrands’ manufacturing operations, which are focused on U.S. cotton and Central America, complement Gildan’s existing operations, offering beneficial tariff positions and supply chain stability. This regional focus is expected to provide a competitive edge over companies that are heavily reliant on Asian production, particularly in light of ongoing global supply chain disruptions.
Industry Reaction and Growth Outlook
Industry leaders have praised the merger, highlighting the strategic synergy between Gildan’s manufacturing strengths and HanesBrands’ brand power. The deal is expected to bring “fresh ideas, enhanced products, and new opportunities for growth,” according to industry analysts. The combined entity’s ability to leverage its expanded brand portfolio and enhanced manufacturing capabilities is expected to drive innovation and growth in the apparel sector.
Gildan has issued a three-year outlook for 2026–2028, projecting net sales growth at a compound annual growth rate (CAGR) of 3% to 5% post-acquisition. The company remains focused on supporting customers and driving long-term shareholder value. With this acquisition, Gildan is set to emerge as a global leader in affordable, everyday apparel, combining enhanced scale, production efficiencies, and a diverse brand portfolio to drive growth and innovation in the years to come.
Conclusion
The acquisition of HanesBrands by Gildan Activewear represents a transformative step in the evolution of both companies, creating a powerhouse in the apparel industry. By combining Gildan’s manufacturing prowess with HanesBrands’ iconic brands, the merged entity is poised to achieve significant cost synergies, expand its market reach, and enhance its competitive position globally. The deal not only strengthens the companies’ financial stability but also underscores their commitment to sustainability and supply chain resilience, positioning them for long-term growth and innovation.
With a projected doubling of Gildan’s annual revenues and a combined brand portfolio that spans basic apparel to activewear, the merger sets the stage for a new era of leadership in the global apparel market. As the industry continues to evolve, this strategic combination is well-positioned to deliver value to shareholders, customers, and stakeholders alike.
Frequently Asked Questions
What are the expected cost synergies from the merger?
The merger is anticipated to yield at least $200 million in annual cost synergies within three years, primarily through optimized production processes and streamlined supply chains.
How will the merger benefit Gildan and HanesBrands?
Gildan gains a strong retail brand presence and diversifies its product offerings, while HanesBrands achieves financial stability and growth opportunities. The combined entity is expected to double Gildan’s annual revenues and expand its global footprint.
What is the timeline for the merger?
The deal is subject to HanesBrands shareholder approval and customary closing conditions, with an expected closing date in late 2025 or early 2026.
How does the merger impact sustainability and supply chain resilience?
The merger strengthens both companies’ commitments to sustainability and supply chain reliability. Gildan’s vertically integrated manufacturing and HanesBrands’ regional operations provide a competitive edge, particularly amid global supply chain disruptions.
What is the outlook for the combined company’s growth?
Gildan has projected a compound annual growth rate (CAGR) of 3% to 5% for net sales from 2026 to 2028, driven by enhanced scale, production efficiencies, and a diverse brand portfolio.
