Gildan Activewear Inc. (asi/56842), which sells apparel through multiple industry suppliers, announced this week that it has signed a definitive agreement to acquire substantially all of the assets of New Buffalo Shirt Factory Inc. for approximately $7 million. New Buffalo is a screen printer and apparel decorator that has an operating affiliate based in Honduras. Following the deal, which is expected to close imminently, New Buffalo's management team, including owner Jon Weiss, will continue to operate the business under Gildan's ownership.
Gildan expects the deal will expand its footprint in the decorated apparel business, following its acquisition of Anvil Knitwear (asi/36350) in May 2012. "The rationale for the acquisition of New Buffalo is to complement the further development of Anvil's business with the major consumer brands which it supplies, and this customer base is expected to fully utilize the capacity of the New Buffalo facilities," Gildan said in a statement announcing the deal. "Although the main focus of Gildan's growth strategy is the continued development of its company-owned brands sold through printwear distributors and retailers, the company believes it also has a growth opportunity to build on Anvil's business as a supply chain partner to global consumer brands."
Gildan, which employs more than 33,000 people worldwide, said last month that it experienced record financial results in the second quarter of its fiscal 2013. Net sales for the company in the second quarter totaled $523 million, an increase of 8.4% from the second quarter of fiscal 2012. The company has increased its sales by 20% through the first six months of its fiscal 2013.
New Buffalo had been owned and operated since 1987 by Weiss, whose grandparents founded the company in Buffalo, NY, in 1940.