|Hanesbrands strikes deal for sportswear brand|
Winston-Salem - HanesBrands, the innerwear and activewear apparel giant is to acquire Champion Europe, which owns the trademark for the Champion brand in Europe, the Middle East and Africa.
Hanes has agreed to acquire the privately held Champion Europe, based in Italy, in an all-cash transaction. The purchase price will be 10 times actual calendar 2016 earnings before interest, taxes, depreciation and amortization, subject to adjustment for cash, debt and working capital. Champion Europe expects 2016 net sales of more than €190 million, operating profit of approximately €15 million, and EBITDA of approximately €20 million.
The acquisition, which is subject to certain closing conditions, is expected to close midyear 2016. Hanes intends to take advantage of its strong balance sheet to fund the acquisition with debt, consistent with its previously communicated capital allocation strategy.
Champion Europe designs, sources and sells Champion athletic apparel wholesale to retailers and directly to consumers via company-owned retail stores. The company’s largest wholesale markets are Italy, Greece, Spain and Scandinavia, while the company operates approximately 130 retail stores in Italy and Greece.
Champion in Europe will be run as a division of the company’s global Champion organization. Sauro Mambrini, chief executive officer and president of Champion Europe, will remain with HanesBrands to oversee Champion Europe operations.
“This acquisition coupled with the recent purchase of the Champion business from our licensee in Japan will unite the Champion brand globally and will give us a powerful platform for growth on every continent,” said Hanes Chief Operating Officer Gerald W. Evans Jr. “Sauro Mambrini and the highly capable management team of Champion Europe will be a great addition to our organization.”
Champion Europe is a major designer, marketer and distributor of athletic apparel and accessories across Europe, Africa and the Middle East. Champion’s distinct brand image, which dates to its founding in Rochester, New York, in 1919, is defined by an American athletic heritage and a reputation for providing innovative and durable products for male and female athletes and teams throughout the world for a wide variety of sports.
“Champion is a great brand that resonates with consumers worldwide,” Mambrini said. “In Europe, we have built a business that reflects the Champion heritage from the United States and then optimizes a natural affinity for Italian apparel design. Our team is eager to join the global Champion team, which will benefit the business in every market served and increase the potential for expansion into new markets.”
After the acquisition closes, Hanes will update its 2016 financial guidance to reflect the closing timing, the outlook for Champion Europe, and any currency considerations.
“This is a great time to do an acquisition,” Hanes Chairman and Chief Executive Officer Richard A. Noll said. “Our overall business is trending as expected; our recent acquisitions are performing well; we have a vision for Champion as a global brand; and we feel good about delivering double-digit earnings growth in 2016 and for many years to come.”