Fashion’s going places with innerwear.
The sector’s seen two big deals in as many weeks and they’ve both had strong cross-border components. That shows that companies are still out there and on the hunt and that, when possible, they’ll put their money to work spreading their businesses across a wider geographical area.
DBApparel — which could be described as the Hanesbrands of Western and Central Europe, selling intimate apparel, hosiery and men’s underwear — brings the company strongly into a new market. Together, the two firms log annual sales of nearly $6 billion and control the worldwide rights to the Playtex, Wonderbra and DIM brands.
And on June 19, Gildan Activewear Inc. said it inked a deal to purchase Doris Inc. for 110 million Canadian dollars, or about $101.4 million. Doris is the third-largest marketer of branded ladies’ legwear in North America and owns sheer pantyhose brand Secret and shapewear brand Silks.
Both companies are Montreal-based, but Gildan noted the acquisition would give it immediate access to “a strong sales organization and platform for retail distribution of the Gildan and Gold Toe brands in Canada.”
Gildan said the deal would also launch it into the ladies intimates category and broaden its “retail distribution network in the United States due to Doris’ strong presence in the food and drug channel.”
M&A is often a way to cut costs or take out a competitor, but it’s also a way to learn new tricks, enter a new market or take one’s strengths and project them over a wider area.
As Richard Noll, chairman and chief executive officer of Hanesbrands, noted, the company’s deal with DBApparel opens up opportunities for both sides to share and learn from the other’s research and development efforts.
“Where the real opportunity lies is actually driving this platform innovation,” he said. “Over time, that will give us the opportunity to gain share not only in their strong markets like France, but also in helping them fill out and round out some of their shares where they’re number two in some of those larger economies.”