MONTREAL — Gildan Activewear Inc. said Thursday it is acquiring competitor Anvil Holdings Inc. for $88 million.
Anvil is the parent company of Anvil Knitwear, a cotton apparel manufacturer based in New York. For its fiscal year ended Jan. 28, Anvil generated earnings before interest, taxes, depreciation and amortization of about $17 million on sales of more than $200 million, according to Gildan.
It added that the Anvil deal will immediately provide Gildan with higher market share in the U.S. T-shirt distributor channel for the same investment that would have to be made in organic growth. Gildan said it expects to generate significant synergies by integrating Anvil’s production for the printwear market into Gildan’s low-cost vertical manufacturing, the integration of Anvil’s U.S. and international distributor sales into Gildan’s printwear business, consolidation of purchasing of raw materials and other purchased cost inputs and savings in ongoing working capital.
Anthony Corsano, president and chief executive officer of Anvil, will become a member of Gildan’s senior management team and join Gildan’s Branded Apparel division to focus on the continuing development of Anvil’s strategy to grow its business of providing high-volume quality products for nonretailer brands.
Gildan also reported Thursday a second-quarter profit of $26.9 million, or 22 cents a share, compared with $61.7 million, or 50 cents a share, in the second quarter of 2011. Sales in the quarter were $482.6 million, up 25.9 percent from $383.2 million in the year-ago period.
The company cited higher cotton and other input costs and higher income taxes compared with last year.
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