Delta Galil to acquire Eminence Group, prominent underwear player in France

Israeli textile firm Delta Galil Industries Ltd. announced that it has signed an option to acquire Eminence SAS and its subsidiaries, known as the Eminence Group. The group manages underwear brands Eminence and Athena in France and the Italian underwear brand Liabel.

Delta Galil said in a press release that it expects the transaction to close in the third quarter of 2018, as there are some French law requirements to fulfill, including a consultation with the Eminence Group’s work council. The price of the transaction is estimated in 125 million euros.

”This is a very compelling transaction for Delta that reflects our strategic efforts to expand our branded business and introduce Delta in a significant way to France and Italy, where our activities to date have been small”, said Isaac Dabah, Delta Galil’s CEO, in the press release.

Eminence is expected to contribute 100 million euros in revenue. The transaction would grow Delta Galil’s revenue to approximately 1.5 billion dollars. Delta Galil’s earnings per share are expected to rise between 0.40 dollars and 0.45 dollars, according to the company’s statement.

Last year, the Eminence group’s net sales totaled 90 million euros, thanks to the company’s strong presence in the French market, which accounts for 79 percent of its sales. The remainder of the group’s sales are located in Western Europe, mainly Italy (17 percent) and Belgium (3 percent). It employs 900 people in Europe, 500 of them in France. Eminence is the strongest brand in the portfolio, having obtained the second largest men’s underwear share in France.

Delta Galil manufactures and markets apparel products under its own name and under brand names licensed for other companies, such as Wilson, Tommy Hilfiger and Lacoste. The company focuses on underwear, shapewear, socks, activewear, sleepwear and denim.

In February, Delta Galil reported a 16 percent sales growth in 2017. “We have several strategic initiatives and category expansions in place for 2018 that are intended to maximize growth opportunities within the premium brands segment”, said Dabah at the time.

Delta Galil has a strong presence in the United States: the American market represented 56% of the company's sales last year. But its European presence still has room for growth. Delta Galil manufactures clothing for Tesco and Marks & Spencer in the UK, and the French brand Etam. In Germany, it owns the underwear brand Schiesser since 2012.