Gildan Activewear Inc.The Canadian clothing manufacturer, which owns the American Apparel brand, has multiple potential buyers interested in a friendly acquisition.
The company from Montreal has established a special board committee to explore options, including assessing a confidential non-binding expression of interest to acquire Gildan. This was stated by spokesperson Simon Beauchemin in an emailed statement. Gildan has enlisted Goldman Sachs Group Inc., RBC Capital Markets and Canaccord Genuity Group Inc. for advice, as per a source familiar with the matter.
Following the expression of interest, the special committee reached out to a small number of credible potential buyers with the help of its financial advisors, as mentioned in the statement.
Several of these potential buyers showed an interest in considering a friendly transaction with Gildan, Beauchemin added, without disclosing their identities. He stated that there is no guarantee that a transaction will be completed.
The shares rose by 10.8 percent in Toronto, giving the company a market capitalization of $8.6 billion, before trading was paused on Tuesday. The initial report of interest from potential buyers was made by The Globe and Mail.
Gildan’s board has been engaged in a contentious dispute with various institutional shareholders and the former CEO Glenn Chamandy, who was dismissed in December due to differences concerning the company’s succession plan and strategy. Vince Tyra, a former executive at Fruit of the Loom, was appointed by the board to take his place.
A dissident group of investors, holding over one third of Gildan’s shares, is led by the investment firm Browning West LP based in Los Angeles. They aim to reinstate Chamandy by electing a new board at the company’s annual meeting on May 28.
- U.S. shareholder takes legal action against Gildan and the board to ensure the AGM takes place
- Gildan and Browning West clash over antitrust allegation
- Ousted Gildan CEO criticizes the 'self serving' board amid an intense battle
Browning West is now taking legal action against the company and its board, accusing them of neglecting the rights and interests of shareholders.
—With assistance from Geoffrey Morgan.
