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Delta Galil Looks to $2 Billion IPO

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Delta Galil Ad

Delta Galil Industries, the Israeli clothing manufacturer, is planning on holding an initial public offering IPO, on Wall Street. Bloomberg reported that Delta Galil expects as much as a $2 billion valuation from the offering. In August, the company first revealed plans to file for an IPO with the SEC.

Bloomberg cited that figure based on what “sources at the company” told the publication. Delta Galil is currently traded on the Tel Aviv Stock Exchange TAS. But its market cap today is only about $1.3 billion, so the company must have a high opinion of its value today. And it has had a great third quarter of 2021 on the TASE, with its share price rising 19% over the last three months.

It is not uncommon for a company that is already listed on a smaller local exchange in its country of origin to later on add a listing on a major exchange abroad, like the New York Stock Exchange or the NASDAQ. Delta Galil was once traded on the NASDAQ, but the company was delisted in 2008. Delisting from an exchange is not necessarily a sign of a corporate failure. Many companies over the years have chosen to go private once again.

In August, Delta Galil reported that it has a very strong Q2 2021. The company’s overall sales and net income continued to be negatively impacted by the COVID-19 pandemic. The Company also noted that its results for the quarter reflected a one-time restructuring charge of $39.2 million to “maximize operational efficiencies, improve cost structure and enhance production flexibility.”

Some of the highlights from Q2 were sales of$270.9 million, a decrease of 27% from $373.9 million reported in the second quarter of 2019; Net loss was $53.3 million, including the restructuring charge noted, compared to net income of $5.1 million the previous year; Operating cash flow improved nearly $46.4 million, to $80.9 million in the second quarter of 2020, from $34.5 million a year prior.

Israel’s Delta Galil Industries is a global manufacturer and marketer of branded and private label apparel products for men, women and children. Founded in 1975, Delta Galil Industries says that it creates products that follow a body-before-fabric philosophy, placing equal emphasis on comfort, aesthetics and quality. Delta Galil develops “innovative seamless” apparel including bras, shapewear and socks; intimate apparel for women; underwear for men; and activewear and sleepwear such as the PJ Salvage brand. Delta Galil also designs, develops, markets and sells branded denim and apparel under the brand 7 For All Mankind and ladies’ apparel under the brands Splendid and others.

In addition, it sells its products under brand names licensed to the company, including Calvin Klein, Columbia, Spalding, Tommy Hilfiger, Wilson and others.

In June, Delta Galil inked a deal with Adidas for a new global licensing agreement in which Delta will design, manufacture and distribute men’s and women’s underwear collections under Adidas’ Badge of Sport and Originals labels. Launching for Spring 2022, the new men’s and women’s collections will be available in the APAC, EMEA, Europe and Latin America regions, with the women’s collections also launching in North America.

Adidas

Adidas Ad

In August Delta Galil continued its expansion with the acquisition of online retailer, Bare Necessities from Walmart, Inc.

Established in 1998, with headquarters outside New York City, Bare Necessities today offers more than 160 brands and 6,400 styles in intimates, women’s swimwear, shapewear, sexy lingerie, sleepwear, and hosiery, among others. Renowned for its expertise in fit and its wide range in sizes, Bare Necessities’ product offering spans Wacoal, Chantelle, SPANX, Calvin Klein and Miraclesuit, with exclusive collections including Birdsong and Camio Mio.

Isaac Dabah, CEO of Delta Galil said at the time, “This transaction reflects our strategic growth objective to diversify our distribution channels. As the digital space currently represents the fastest growing segment in our industry, we are very pleased to acquire such an authority in online intimates. Bare Necessities can significantly enhance Delta Galil’s presence in the digital world, as we continue to pursue growth online. I look forward to partnering with the senior leadership of Bare Necessities to achieve strong, profitable growth.”

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