Canada's Gildan nears deal to buy Hanesbrands at about $5 billion valuation, source says
The talks are at an advanced stage and a deal could be agreed to by the end of the week, the person said on Tuesday, on condition of anonymity, adding that an acquisition may still not be finalized.
Shares of Hanesbrands, which was valued at $1.71 billion as of Monday's close, were up nearly 28% in late afternoon trading. Toronto-listed Gildan's shares fell 3.7%.
The Canadian clothing company, which mostly makes basic apparel used for customizing and personalizing, had a market capitalization of about C$10 billion ($7.62 billion).
Hanesbrands and Gildan did not immediately respond to requests for comment.
The maker of Hanes and Bonds innerwear has been reeling under the impact of tariffs, which have impacted 75% of its sales and have triggered a more than 40% drop in shares so far this year.
Still, Hanesbrands last week beat market estimates for profit and revenue in the second quarter and raised its annual forecast, citing higher cost savings.
Hanesbrands sold its sportswear brand Champion to Authentic Brands Group in a $1.2 billion deal last year, as the company looked to streamline its business and focus on its innerwear segment.
Last year, Gildan's entire board resigned and CEO Vince Tyra stepped down as president and CEO after a prolonged proxy battle.
The deal was first reported by the Financial Times earlier on Tuesday.
($1 = 1.3772 Canadian dollars)
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