WINSTON-SALEM, N.C.--(BUSINESS WIRE)--Jul. 15, 2016--
HanesBrands (NYSE: HBI), a leading worldwide marketer of underwear,
intimate apparel and activewear, today announced that it has completed
the acquisition of Pacific Brands Limited, the leading underwear and
intimate apparel company in Australia.
The acquisition of Pacific Brands adds Bonds, Australia’s top
brand of underwear, babywear and socks, and Berlei, the country’s
No. 1 sports bra brand and leading seller of premium bras in department
stores, to HanesBrands’ worldwide portfolio of leading innerwear brands
supported by the company’s global low-cost supply chain and
manufacturing network. Hanes also sells Playtex intimate apparel
and Champion activewear in Australia.
Hanes acquired the publicly traded Pacific Brands for approximately
US$800 million on an enterprise-value basis, or slightly more than 10
times projected calendar 2016 EBITDA. Annualized sales for Pacific
Brands' core Underwear and Sheridan divisions are approximately AUD800
million (US$600 million). The all-cash transaction is expected to
deliver an after-tax internal rate of return in the mid-teens.
“Pacific Brands with its iconic century-old and fast-growing Bonds
brand is a great addition to our strong market-leading portfolio
spanning the Americas, Europe and Asia-Pacific that is supported by a
world-class company-owned global supply chain,” said Hanes Chief
Operating Officer and CEO-Elect Gerald W. Evans Jr. “We are adding a
top-notch management and marketing team led by CEO David Bortolussi that
will help serve as a catalyst for continued growth and value creation
into the foreseeable future.”
The Pacific Brands acquisition is the second that Hanes has completed in
the past two weeks. The expected performance of Pacific Brands for the
balance of the 2016 calendar fiscal year, as well as that of Champion
Europe, acquired June 30, 2016, is already reflected in the company’s
updated financial guidance announced May 31, 2016.
Hanes has made six acquisitions in the past three years. The company now
holds the No. 1 or No. 2 market share position for underwear, intimate
apparel or hosiery in a dozen countries, including the United States,
Australia, France, Japan, Canada, Germany, Italy, Mexico, Spain, Brazil,
South Africa, and New Zealand.
Pacific Brands has three business units – Underwear, Sheridan, and
Tontine & Dunlop Flooring. Hanes intends to divest the noncore Tontine
pillow business and Dunlop Flooring business. Based on fiscal 2016
expectations, the core Underwear and Sheridan luxury linens, towels and
babywear businesses had a combined two-year compound annual sales growth
rate of approximately 8 percent.
Pacific Brands sells wholesale to retailers and operates approximately
325 Bonds and Sheridan retail stores and retailer shop-in-shops. Bonds
sales have increased 40 percent since 2013.
The acquisition is expected to result in significant savings through the
use of Hanes’ large-scale, low-cost global supply chain. Pacific Brands
sources the significant majority of its underwear and intimate apparel
production from third-party manufacturers, while Hanes relies primarily
on company-owned manufacturing. The acquisition also adds to Hanes’
global product design, development and innovation capabilities that span
the Americas, Europe and the Pacific Rim.
Cautionary Statement Concerning Forward-Looking Statements
This press release includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. Forward-looking statements include
all statements that do not relate solely to historical or current facts,
and can generally be identified by the use of words such as “may,”
“believe,” “will,” “expect,” “project,” “estimate,” “intend,”
“anticipate,” “plan,” “continue” or similar expressions. In particular,
among others, statements about the expected full-year 2016 performance
of Pacific Brands Limited and Champion Europe S.p.A. are forward-looking
statements. Forward-looking statements inherently involve many risks and
uncertainties that could cause actual results to differ materially from
those projected in these statements. Where, in any forward-looking
statement, we express an expectation or belief as to future results or
events, such expectation or belief is based on the current plans and
expectations of our management, expressed in good faith. However, there
can be no assurance that the expectation or belief will result or will
be achieved or accomplished, and actual results may differ materially
from those contemplated by the forward-looking statements. A number of
important factors could cause actual results to differ materially from
those contemplated by the forward-looking statements, including, but not
limited to our ability to achieve expected synergies and successfully
complete the integrations of Pacific Brands and Champion Europe, the
highly competitive and evolving nature of the industry in which we
compete; legal, regulatory, political and economic risks associated with
our operations in international markets, including the risk of
significant fluctuations in foreign exchange rates; the loss or
interruption of services of a member of our senior management team; the
accuracy of the estimates and assumptions on which our financial
statement projections are based; any inadequacy, interruption,
integration failure or security failure with respect to our information
technology; the impact of significant fluctuations and volatility in
various input costs, such as cotton and oil-related materials,
utilities, freight and wages; current economic conditions, including
consumer spending levels and the price elasticity of our products;
unanticipated business disruptions or the loss of one or more suppliers
in our global supply chain; and other risks identified from time to time
in our most recent Securities and Exchange Commission reports, including
our annual report on Form 10-K and quarterly reports on Form 10-Q, as
well as in the investors section of our corporate website at www.Hanes.com/investors.
We believe these forward-looking statements are reasonable; however,
undue reliance should not be placed on any forward-looking statements,
which are based on current expectations. All forward-looking statements
speak only as of the date hereof. We undertake no obligation to update
or revise forward-looking statements that may be made to reflect events
or circumstances that arise after the date made or to reflect the
occurrence of unanticipated events, other than as required by law.
HanesBrands
HanesBrands, based in Winston-Salem, N.C., is a socially responsible
leading marketer of everyday basic innerwear and activewear apparel in
the Americas, Europe and Asia under some of the world’s strongest
apparel brands, including Hanes, Champion, Playtex, DIM,
Bali, Maidenform, Bonds, JMS/Just My Size,
L’eggs, Wonderbra, Nur Die/Nur Der, Lovable, Berlei,
and Gear for Sports. The company sells T-shirts, bras, panties,
shapewear, underwear, socks, hosiery, and activewear produced in the
company’s low-cost global supply chain. A member of the S&P 500 stock
index, Hanes has approximately 65,300 employees in more than 40
countries and is ranked No. 448 on the Fortune 500 list of America’s
largest companies by sales. Hanes takes pride in its strong reputation
for ethical business practices. The company is the only apparel producer
to ever be honored by the Great Place to Work Institute for its
workplace practices in Central America and the Caribbean, and is ranked
No. 167 on the Forbes magazine list of America’s Best Employers. For
seven consecutive years, Hanes has won the U.S. Environmental Protection
Agency Energy Star sustained excellence/partner of the year award – the
only apparel company to earn sustained excellence honors. The company
ranks No. 172 on Newsweek magazine’s green list of 500 largest U.S.
companies for environmental achievement. More information about the
company and its corporate social responsibility initiatives, including
environmental, social compliance and community improvement achievements,
may be found at www.Hanes.com/corporate.
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Source: HanesBrands
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Matt Hall, 336-519-3386
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