The Gildan logo is seen outside their offices in Montreal, Monday, Dec. 11, 2023. THE CANADIAN PRESS/Christinne Muschi
Gildan Activewear Inc., a Montreal-based clothing manufacturer, is considering selling its business after receiving interest from at least one potential buyer. The company announced on Tuesday that it had received a "non-binding expression of interest" from an unnamed party. To evaluate this proposal and explore other options, including maintaining the status quo, Gildan's board established a special committee of independent directors. According to spokesperson Simon Beauchemin, the board concluded that it was in Gildan's best interest to reach out to additional potential buyers to maximize the value of any potential transaction. While several parties have shown interest in pursuing a friendly transaction with Gildan, Beauchemin emphasized that there is no assurance that a deal will be finalized.
This development comes amidst internal strife within Gildan regarding its leadership. Last year, co-founder Glenn Chamandy was replaced as CEO by Vince Tyra, who previously held executive positions at Alphabroder and Fruit of the Loom. However, some shareholders, including Browning West, Jarislowsky Fraser, and Turtle Creek Asset Management Inc., have contested Tyra's appointment and advocated for Chamandy's reinstatement. They praised Chamandy's leadership and criticized the decision to remove him, alleging that it was made hastily and without proper consideration of shareholder interests.
Gildan's management countered these claims by asserting that Chamandy lacked a credible long-term strategy and was pursuing risky acquisitions that deviated from the company's core manufacturing focus. They also accused Chamandy of having inappropriate relationships with certain shareholders supporting his return. Chamandy responded to these allegations by defending his leadership and accusing the board of making false and defamatory statements. He argued that the board's actions had created uncertainty for Gildan's stakeholders.
The history of Gildan traces back to 1946 when Joseph Chamandy, Glenn Chamandy's grandfather, founded Harley Inc., a manufacturing company specializing in activewear, children's apparel, and sleepwear. In 1982, Greg and Glenn Chamandy took over the business, and two years later, they expanded it by acquiring Gildan Textiles Inc., a knitting manufacturing company.
As Gildan evaluates its options, it remains committed to maximizing value for its shareholders while navigating internal and external challenges. The outcome of this process will have significant implications for the company's future direction and its stakeholders.
