Call it a merger of the underwear giants.
On Wednesday, Hanesbrands (HBI) announced that it will pay $23.50 a share to acquire Maidenform Brands (MFB). The deal is valued at $547 million and represents a 23% premium over Maidenform’s last share closing price, Reuters notes.
Predictably, Maidenform shares jumped more than 22% in pre-market trading on Wednesday. But Hanebrands investors appeared to like the deal, too, sending the maker of popular men’s and women’s underwear up 3% in pre-market trading.
Goldman Sachs (GS) is advising Hanesbrands during the merger, which will be financed by credit borrowing and cash.
Maidenform makes the Sweet Nothings, Lilyette, Flexees and Self Expressions lingerie brands, while Hanesbrands is known for its Wonderbra, Playten and Barely There women’s brands.
Within three years, the acquisition is projected to boost Hanesbrand’s annual earnings per share by 60 cents.