CHICAGO — Fruit of the Loom Inc. plans to spend up to $200 million to repurchase about 7 percent of its common stock.
There are currently 76.4 million shares outstanding.
“We believe the current market value of Fruit of the Loom common stock does not reflect the underlying strengths of the company — its customers, products and the markets it serves, as well as its strong financial position,” William Farley, chairman and chief executive officer, said in a statement.
FTL stock closed Tuesday at 35 7/8, up 1/2, on the New York Stock Exchange.
At the same time, FTL said it has completed the previously announced sale of its hosiery business to Renfro Corp. of Mount Airy, N.C. The sale includes substantially all of the assets of FTL’s hosiery manufacturing operations for $74 million and the liquidation of other related assets for about $16 million.
Renfro has entered into a long-term licensing agreement with FTL granting Renfro an exclusive license to use the Fruit of the Loom trade name and trademarks for athletic, casual and dress socks for adults and children.