Gildan Eyes Debut Bond Sale Later This Year as Proxy Costs Soar

(Bloomberg) -- Gildan Activewear Inc. plans to sell bonds as early as the second half of the year as the T-shirt maker increases leverage after an expensive proxy fight, a spokesperson told Bloomberg News.

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The precise timing of the issuance will depend on market conditions, the spokesperson said.

A dispute between Gildan’s board and investment firm Browning West LP ended last week with the resignation of the company board, and previously ousted Chief Executive Officer Glenn Chamandy returning to replace Vince Tyra. The fight cost Gildan around $65 million including severance and legal expenses.

After the leadership changes, Gildan and Caisse de Depot et Placement du Quebec aren’t proceeding with a planned C$200 million ($146 million) private placement of senior unsecured notes to the Quebec pension fund, Bloomberg reported.

Gildan, rated low-investment grade, has not issued any bonds. The company plans to tap the bond market and boost its leverage ratio, Chamandy told BNN Bloomberg Television on Tuesday.

Read More: ‘We Were Going to Win’: Activist Kingmaker Stages Coup at Gildan

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