Gildan Activewear to Acquire HanesBrands for $4.4bn, Creating Global Basic Apparel Leader

Gildan Activewear is acquiring US apparel brand HanesBrands for $4.4bn. The transaction will create a global basic apparel leader, expanding Gildan's scale and strengthening its market positioning. The combined company will benefit from enhanced product diversification, a low-cost manufacturing network, and significant synergy opportunities. Gildan has obtained $2.3bn of committed financing and expects $200m in annual cost synergies by 2028. The transaction is expected to close between late 2025 and early 2026.

Gildan Activewear Inc. (GIL) has agreed to acquire HanesBrands Inc. (HBI) for approximately $4.4 billion, a deal that is expected to close between late 2025 and early 2026. The acquisition will create a global leader in basic apparel, combining Gildan's strong position in activewear with HanesBrands' robust brand portfolio and U.S. innerwear dominance.

The transaction is valued at an enterprise value of approximately $4.4 billion, based on the closing price of Gildan common stock on August 11, 2025. Gildan has secured $2.3 billion of committed financing to support the acquisition. The combined entity is expected to generate significant synergies, with annual cost synergies of at least $200 million by 2028 [1].

The merger will double Gildan's revenues and strengthen its position in the basic apparel market. The combination will leverage Gildan's leadership in activewear and HanesBrands' expertise in innerwear, enhancing go-to-market capabilities and accelerating growth across channels [1]. Wells Fargo has upgraded HanesBrands to an Equal Weight rating with a price target of $6, up from $5, following the merger announcement [2].

The acquisition is expected to be immediately accretive to Gildan's adjusted diluted EPS and 20%+ accretive pro forma for expected run-rate synergies of $200 million [1]. The deal could create a 40% market share leader in basic apparel, reshaping competition and offering investors potential margin expansion through scale [2].

However, the deal is not without risks. HanesBrands' debt load of $3.1 billion as of 2023 and its recent sale of the Champion brand to Authentic Brands Group for $1.2 billion suggest a need for careful integration. Gildan's CEO, Glenn Chamandy, has emphasized the importance of "streamlining operations and leveraging scale," but execution will be key [2].

For retail investors, the acquisition presents a dual opportunity. A successful deal could boost Gildan's stock through cost synergies and expanded margins. Analysts at RBC and UBS have raised price targets for Gildan to $70 and $68, respectively, citing the potential for a 20% earnings lift [2]. The combined entity could dominate the $200 billion global basic apparel market, with a focus on high-margin innerwear and activewear.

While the acquisition is not yet finalized, the strategic logic is compelling. Gildan's strong balance sheet and HanesBrands' brand resilience make the deal a high-probability outcome. For investors, the key is to monitor integration risks and debt management.

References:
[1] https://ir.hanesbrands.com/news-releases/news-release-details/gildan-and-hanesbrands-agree-combine-create-global-basic-apparel
[2] https://www.ainvest.com/news/gildan-strategic-move-acquire-hanesbrands-game-changer-apparel-industry-2508/