Underwear company HanesBrands buys bra firm Maidenform
HanesBrands Inc.’s cups runneth over with its purchase Wednesday of bra company Maidenform Brands Inc.
The deal, which the companies valued at $575 million, unites two major forces in the delicates industry.
HanesBrands, based in Winston-Salem, N.C., is known for its namesake label Hanes as well as names such as Playtex, Wonderbra and Champion.
Maidenform, of Iselin, N.J., owns brands such as Self Expressions and Sweet Nothings and does 90% of its business in the U.S.
HanesBrands said it hopes to unite its panty and full-figure bra segments with Maidenform’s own bra lines, which generated 57% of the company’s revenue last year.
Also appealing for HanesBrands: Maidenform’s shape-wear prowess, which snared 35% of the company’s sales over the same period.
The $23.50-a-share acquisition is a 23% premium to Maidenform’s $19.09 closing price Tuesday. The transaction, which is expected to close in the fourth quarter, was unanimously approved by both companies’ boards.
The deal must now clear Maidenform shareholders and regulators.
HanesBrands shares closed up $4.22, or 7.9%, to $57.58 on Wednesday. The stock is up 62% since the start of the year.
Maidenform closed up 22.4%, or $4.27, to $23.36 a share. The stock is up nearly 20% for the year but has had a choppier trajectory than its new owner.
HanesBrands projects that its annual revenue will exceed $5 billion once Maidenform is absorbed. Maidenform sources all of its products from third parties, while HanesBrands uses outside contractors to supplement its company-owned global manufacturing system.
HanesBrands said it expects the union to create cost-savings opportunities and better scale.
And by taking Maidenform under its wing, HanesBrand may also be able to challenge competitors such as Jockey, which this year said it had “reinvented the bra.â€
Jockey unveiled a new brassiere with a patented “volumetric fit system†that ditched traditional cup sizes and uses contouring technology instead of under-wires.
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