Gildan Completes Sale of HanesBrands Australia for $490 Million in Cash to Repay Debt
Key Facts
Gildan Activewear said on October 26 that it had completed the sale of HanesBrands Australia to BBFIT Investments for about A$700 million, equivalent to about US$490 million, paid in cash at closing. The company said it intends to use the net proceeds to repay outstanding debt. The closing turns an agreement announced in July into cash proceeds earmarked for debt reduction, at a time when the unit had been classified as held for sale and excluded from continuing operations in financial statements since the fourth quarter of 2025. Gildan described the transaction as a step in its HanesBrands integration plan and did not link it to an announcement that it was exiting the Australian market. The CEO said completion "represents another important step in executing our ongoing integration plan."
The buyer, BBFIT Investments, is an entity affiliated with BB Retail Capital, which Gildan described as a global private investment firm. On July 30, the company announced a definitive agreement to sell the business at an enterprise value of about A$700 million, or about US$490 million, subject to customary purchase price adjustments. The completion announcement specifies the cash consideration paid at closing, allowing Gildan to direct the net proceeds to debt. In its July announcement, the company said the sale was part of its HanesBrands integration plan. The divestiture was also tied to a goal of returning to the midpoint of its target leverage range, according to the second-quarter announcement. The next financial step the company announced is therefore focused on using the proceeds to repay outstanding obligations.
Gildan's net debt was US$4.689 billion at the end of the first half of 2026, while its ratio of net debt to adjusted earnings before interest, taxes, depreciation and amortization, on a trailing 12-month basis, was 3.2 times. That level puts the sale proceeds of about US$490 million in the context of the company's debt, but Gildan did not disclose in its completion statement how much debt it would repay specifically or what ratio it expects to reach after repayment. In July, the company said targeting the midpoint of its leverage range was part of its financial path alongside the HanesBrands integration. In the second quarter, continuing-operations sales were $1.58 billion, up 72.3% year over year. The company attributed the increase to the HanesBrands acquisition, partly offset by integration initiatives. These figures highlight the scale of the business being integrated alongside the company's commitment to reducing debt.
Gildan said in its second-quarter results that it expects to achieve annual cost savings at a run rate of about US$250 million over the next three years as the HanesBrands integration advances. It also said it had completed the initial phase of reorganizing its supply-chain footprint and begun reallocating production across its combined network to support the realization of synergies. This places the sale of the Australian unit among a series of steps the company has announced as it executes the integration, while the stated use of the net proceeds remains debt repayment. Gildan shares closed at $40.5 on October 23, according to EL7 data. The available data in this report do not include the session's trading range. The company is scheduled to report third-quarter results on November 5, the next date for updates on integration progress and the savings it has previously announced.