HanesBrands To Acquire Australia’s Pacific Brands Limited
As reported earlier today in a PPB Newslink breaking news alert, HanesBrands has entered into a definitive agreement to acquire Pacific Brands Limited, the leading underwear and intimate apparel company in Australia. The all-cash transaction is valued at approximately $800 million and is expected to close third-quarter 2016. Winston-Salem, North Carolina-based HanesBrands participates in the promotional products industry as supplier Hanes/Champion (UPIC: HBIINC).
HanesBrands expects Pacific Brands to have calendar 2016 net sales in its core Underwear and Sheridan businesses of approximately AUD800 million (US$600 million) and adjusted operating profit of AUD75 million (US$56 million). The Melbourne-based company, which has a June fiscal year end, sells primarily in Australia with some distribution in New Zealand, the United Kingdom and Asia. Hanes will seek to retain the Pacific Brands senior management team to run the business after the acquisition.
“Pacific Brands is a natural addition to the HanesBrands portfolio with its strong market-leading brands that will be complemented by our global supply chain,” says Hanes Chairman and Chief Executive Officer Richard A. Noll. “In the span of 10 years, we have transformed the company through acquisitions and our Innovate-to-Elevate initiatives. We have tripled operating profits and expanded from a $4 billion company concentrated in the United States to a $7 billion global underwear and activewear powerhouse spanning the Americas, Europe and Asia-Pacific. This foundation will serve as a catalyst for even further growth and value creation for the foreseeable future.”
Hanes expects the acquisition to bring savings through use of its company-owned global supply chain, as Pacific Brands sources most of its underwear and intimate apparel from third-party manufacturers.
“Pacific Brands, led by a top-notch management and marketing team, will make a significant addition to our worldwide portfolio of leading brands,” says Hanes Chief Operating Officer Gerald W. Evans Jr. “We believe we can make meaningful contributions to the continued execution of the Pacific Brands growth strategy and support it with our world-class, low-cost supply chain. This will also add geographic scale that will benefit our existing Champion Australia business.”
Earlier this month HanesBrands announced an agreement to acquire privately held Champion Europe, which owns the trademark for the Champion brand in Europe, the Middle East and Africa. In April 2015, the company acquired Knights Apparel, a seller of licensed collegiate logo apparel in the mass retail channel.