NEW YORK — Haggar Corp., one of the country’s largest makers of casual slacks, said early Thursday it would be acquired by a partnership among private equity firms Infinity Associates LLC, Perseus LLC and Symphony Holdings Ltd. for $212 million.
Dallas-based Haggar, which markets women’s sportswear and men’s casual and dress apparel and holds the exclusive licenses in the U.S. for Claiborne, Kenneth Cole New York and Kenneth Cole Reaction trademarks for men’s pants, unanimously approved the merger agreement and has recommended that the stockholders adopt the agreement. Shareholders will receive $29 in cash for each share they hold. The deal is expected to close by the end of 2005.
In a statement issued at 3:20 a.m. Thursday, chairman and chief executive officer J.M. Haggar 3rd said the deal will help the firm improve its sourcing, strengthen its marketing power and grow in the global market. It has already made moves to improve its efficiency over the course of the past few years.
Haggar Corp. recently shut down two manufacturing facilities in the Dominican Republic and Mexico, and is incorporating new technology into its warehouse and inventory management. Two years ago, the company replaced all paper-based instructions in its warehouse in Texas that specializes in replenishments for individual stores with a voice-controlled picking system from Voxware Inc., which sped up operations by roughly 10 percent, reduced errors by more than 50 percent and reduced labor costs.
In the past year, Haggar also made gains on its balance sheet. As of the end of the third quarter of fiscal 2005, the company had paid down all of its corporate debt and reduced inventory levels to $88 million, down from $5.7 million in debt and $96 million in inventory a year prior.
In its most recent quarter, the company reported net income that climbed to $4.8 million, which compares with $1.7 million in the prior year. Sales rose 2.8 percent to $119.5 million from $116.3 million a year ago. Shares of Haggar closed up 22.34 percent to $28.31 Thursday.