Home / Knowledge / News / Apparel/Garments / HanesBrands to buy top Aus underwear co Pacific Brands
HanesBrands to buy top Aus underwear co Pacific Brands
28
Apr '16
Courtesy: Pacific Brands
Courtesy: Pacific Brands
HanesBrands, a leading worldwide marketer of underwear, intimate apparel and activewear, has announced that it has entered into a definitive agreement to acquire Pacific Brands Limited, the leading underwear and intimate apparel company in Australia.

The acquisition would be Hanes' sixth in the past three years and would add Australia and New Zealand to the list of countries where the company holds the No. 1 or No. 2 market share position for underwear, intimate apparel or hosiery. The countries include the US, Canada, Mexico, Brazil, France, Germany, Italy, Spain, and South Africa, the company said in a press release.

HanesBrands projects that under its ownership publicly traded Pacific Brands would have calendar 2016 net sales in its core Underwear and Sheridan businesses of approximately 800 million Australian dollars ($600 million) and adjusted operating profit of AUD75 million ($56 million). The Melbourne-based company, which has a June fiscal year end, sells primarily in Australia with some distribution in New Zealand, UK, and Asia.

The transaction is valued at approximately $800 million on an enterprise-value basis, or slightly more than 10 times projected calendar 2016 EBITDA (for all businesses), and would pay Pacific Brands shareholders AUD1.15 per share.

The all-cash transaction is expected to be immediately accretive to adjusted earnings per share and deliver an after-tax internal rate of return in the mid-teens. It is projected to deliver full benefits within three years, attaining adjusted operating profit of approximately $100 million, contributing approximately S$0.25 to Hanes' adjusted EPS.

“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,” Hanes Chairman and Chief Executive Officer Richard A. Noll said. “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 US to a $7 billion global underwear and activewear powerhouse.”

Pacific Brands has three business units – Underwear, Sheridan, and Tontine & Dunlop. The company has undergone significant restructuring over the past two years to streamline its portfolio to focus on the core Underwear and Sheridan businesses.

Hanes intends to divest the Tontine pillow business and Dunlop Flooring business, which it does not consider part of Pacific Brands' core. Combined, they account for 12 per cent of sales and operating profit (excluding corporate overhead allocation). Hanes is not including sales and profits for those businesses in its long-term projections.

Pacific Brands' restructuring and focus on Underwear and Sheridan has resulted in significant sales and profit growth. Based on fiscal 2016 expectations, the core businesses have a combined two-year compound annual sales growth rate of approximately 8 per cent.

Of the core business, Underwear accounts for three-fourths of sales and includes underwear, bras, socks, hosiery, babywear and outerwear. (SH)

Fibre2Fashion News Desk – India

Must ReadView All

Apparel/Garments | On 22nd Mar 2017

Amazon India introduces 'A-Z GST Guide' programme

Amazon India has introduced a programme called 'A-Z GST Guide' to...

Textiles | On 22nd Mar 2017

Dyeing textiles with bacteria

As an alternative to toxic synthetic dyes, scientists are exploring...

Courtesy: BCG

Apparel/Garments | On 22nd Mar 2017

Consumption in India to touch $4 trillion by 2025: Report

Consumption in India is likely to triple to $4 trillion by 2025 as...

Interviews View All

Jurgen Gauger
Spreadshirt

‘Buying crowdsourced or creative designs are much more appealing to the...

Rahul Bhadani
Looksgud

Navigating through catalogues is a bit hasslesome

Abhimanyu Singh Rathore & Barbara Anna Kosiorek
Kannbar

‘Blending cultures is the true beauty of fashion, where one’s imagination...

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer <b>Prathyusha Garimella</b> is known for blending ...

Pranav Mishra
Huemn

Designers Pranav Mishra and Shyma Shetty’s Huemn is known for its...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
March 2017

March 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search