Delta Galil in talks to buy US jeans maker
Israeli company negotiating acquisition of Jones Group's denim activity for $350-400 million, estimates agreement will be reached within month
On Tuesday the company announced that it was negotiating the acquisition of the Jones Group's denim activity, which handles production for several well-known labels such as Gloria Vanderbilt.
"The company estimates that the price tag will be an overall $350-400 million," Delta wrote in its TASE fillings, noting, however, that the price is subject to change.
Furthermore, Delta noted that the parties had yet to sign a binding agreement and that the company had yet to make financing arrangements with banks. However, the company believes that negotiations with Jones Group and the banks will be concluded within a month.
Jones Group operates a number of other brands aside from its denim activity which Dabah is seeking to acquire. The group's market cap is $832.8 million. Its earnings for 2010 were $3.64 billion and its net profit was $53.8 million.
The company has $141 million in cash. In 2009 the company posted an $86.6 million loss and in 2008 it posted a whopping $765.4 million loss.
Dabah is familiar with the corporation's denim activity, having acquired it in 1993 and running it for 10 years until Jones Group bought it from him in 2002.
Dabah stayed on as the company's denim activity manager until 2004, after which he acquired part of Delta's shares and finally took over the company.
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