BREAKING NEWS: Gildan Activewear wins auction to acquire American Apparel

Gildan Activewear Inc. announced last night that it has won the court-supervised auction to acquire the American Apparel brand and certain assets from American Apparel, LLC. The transaction is subject to the Bankruptcy Court approval on 12 January 2017 and Gildan anticipates completing the acquisition by February 2017.

As announced on 14 November 2016, Gildan entered into an asset purchase agreement with American Apparel that served as the initial bid. American Apparel voluntarily filed for Chapter 11 bankruptcy protection on the same day.

Gildan Activewear Inc.'s final cash bid of approximately $88 million includes the acquisition of the worldwide intellectual property rights related to the American Apparel brand and certain manufacturing equipment. The company will also separately purchase inventory from American Apparel to ensure a seamless supply of goods to the printwear channel while the company integrates the brand within its printwear business. Consistent with the terms of the original agreement, Gildan will not be purchasing any retail store assets.

"The American Apparel brand will be a strong complementary addition to our growing brand portfolio. We see strong potential to grow American Apparel sales by leveraging our extensive printwear distribution networks in North America and internationally to drive further market share penetration in the fashion basics segment of these markets," said Glenn Chamandy, President and CEO of Gildan.

Gildan will provide details on the projected financial contribution of the acquisition on its earnings in February, when it reports its 2016 full-year earnings results and initiates guidance for 2017.

About Gildan

Gildan is a manufacturer and marketer of quality branded basic family apparel, including T-shirts, fleece, sport shirts, underwear, socks, hosiery, and shapewear. The company sells its products under a diversified portfolio of company-owned brands, including the Gildan, Gold Toe, Anvil, Comfort Colors, Alstyle, Secret, Silks, Kushyfoot, Secret Silky, Peds, MediPeds and Therapy Plus brands.

The company sells its products through two primary channels, namely the printwear and retail markets. The company distributes its products in printwear markets in the USA, Canada, Europe, Asia-Pacific, and Latin America. In retail markets, the company sells its products to a broad spectrum of retailers primarily in the USA and Canada, and also manufactures for select leading global athletic and lifestyle consumer brands.

Gildan owns and operates vertically-integrated, large-scale manufacturing facilities which are primarily located in Central America, the Caribbean Basin, North America and Bangladesh. These facilities are strategically located to efficiently service the quick replenishment needs of its customers in the printwear and retail markets.