HanesBrands To Acquire Maidenform Brands For $23.50/shr - Quick Facts

(RTTNews) - HanesBrands Inc. (HBI) announced Wednesday that it has entered into a definitive agreement to acquire Maidenform Brands Inc. (MFB), for $23.50 per share, a 30 percent premium to Maidenform's average closing price over the past 30 days. The transaction valued at approximately $575 million on an enterprise-value basis.

HanesBrands said that the all-cash transaction is expected to be accretive to earnings per share in the first 12 months after closing and is projected to deliver full benefits within three years of more than $500 million in incremental annual sales, $0.60 in earnings per share, $80 million of operating profit, and $65 million of free cash flow. After the transaction closes, HanesBrands' pro forma projected annual revenue would be more than $5 billion.

The transaction has been unanimously approved by the boards of directors of both companies. The acquisition is expected to close in the fourth quarter of 2013.

Hanes said it intends to fund the acquisition with cash on hand and short-term borrowings on its revolving credit facility, which will be retired through free cash flow. The company has completed an amendment to its revolver that decreases borrowing costs by 25 basis points and increases the borrowing limit to $1.1 billion.