Gildan Activewear has confirmed that it is in talks with several interested parties over a potential sale of the business. Amid the background of an ongoing shareholder revolt, the talks were prompted by the receipt of an expression of interest from an initial potential bidder.
Gildan said that in response to the receipt of a confidential non-binding expression of interest to acquire Gildan, its board has now formed a Special Committee of independent directors to, among other things, review and consider the merits of the proposal and any alternative transaction, including maintaining the status quo and continuing to execute on Gildan’s existing business plan.
“After consulting with its legal and financial advisors and considering the interests of Gildan’s shareholders and other stakeholders, the Special Committee determined that it was consistent with its fiduciary duties and in the best interests of Gildan to contact other potential bidders with a view to maximising the value of any potential transaction,” the company said in a statement. “The Special Committee, with the assistance of its financial advisors, conducted targeted outreach to a small number of reputable potential counterparties. Several of these counterparties expressed an interest in considering a potential friendly transaction with Gildan. “There can be no assurance any transaction will result from these discussions, and Gildan will continue to provide updates as appropriate.”
In February, Gildan Activewear shareholder Browning West, which holds approximately 5% of the company’s outstanding shares, filed a lawsuit against the activewear giant to ensure the rights of shareholders are preserved at May’s annual meeting of shareholders.
The lawsuit, filed at the Superior Court of Quebec – Commercial Division against Gildan and the company’s board of directors, is the latest stage of the shareholder revolt that has engulfed Gildan since the late-2023 sacking of Chief Executive Officer Glenn Chamandy. Gildan shares leapt 10% on news of a potential takeover. It now has a market capitalisation of around US$6.2 billion.
