GoldToeMoretz wants to sock it to the competition. It makes socks for sporting goods stores and retailers, such as Gap, Target, and Old Navy, and offers private-label services for companies including Cherokee, Faded Glory, and Pro Spirit. It peddles the PowerSox brand -- a heavy hitter in performance socks -- as well as Gold Toe. GoldToeMoretz has licensing agreements with the likes of New Balance and Under Armour and ships some 360 million pairs of socks annually. Founded in 1946, Moretz was bought by The Blackstone Group for $400 million in 2006; it later merged with 90-year-old Gold Toe to form GoldToeMoretz and become the top US sock maker. Looking to pair up, Gildan Activewear acquired the company in 2011.
A powerhouse in sock-making itself, Gildan Activewear shelled out $350 million for GoldToeMoretz. The acquisition stands to double Gildan Activewear's sock revenue, expand its customer base, and generate licensing revenue from exclusive deals under popular brand names. Based in Montreal, Gildan Activewear makes and markets T-shirts, socks, underwear, and other items. The company, which sells its own brand of socks and underwear in the US and Canada through mass-market retailers the likes of Wal-Mart, plans to leverage GoldToeMoretz's expertise in the US. Besides Moretz chairman John Moretz himself, president and CEO Steve Lineberger is expected to remain with the sock maker.
Prior to the transaction, Blackstone had owned 65% of GoldToeMoretz, followed by Moretz chairman John Moretz, who was the company's second-largest shareholder. The GoldToeMoretz entity has benefited from its combined strength as a supplier to department stores and specialty sporting goods channels. GoldToeMoretz also operates Moretz Marketing, a full-service marketing and licensing unit, which counts Bassett Furniture Industries' John Elway American Lifestyle Home Brand among its clients.