Tefron Announces Completion of Transaction to Acquire Seamless Activities of Nouvelle Canada Amid Strong Shareholder Approval Company to Receive $10.8 Financial Injection From Capital Increase and New Bank Loans
MISGAV, Israel, December 30, 2010 /PRNewswire-FirstCall/ -- Tefron Ltd. (OTC: TFRFF.OB; TASE:TFRN) ("Tefron"), a leading producer of seamless intimate apparel and engineered-for-performance (EFPTM) active wear, today announced the closing of the transaction between Tefron Ltd. and Canadian apparel manufacturer, Nouvelle, for Tefron to acquire the seamless activities of Nouvelle Inc., and the completion of two financial transactions raising $10.8 million of fund for the company. Today's closing follows yesterday's shareholders' meeting where the transactions received a strong majority approval by investors.
With the closing of the transaction, Tefron acquired the seamless assets of Intimes Nouvelle Seamless Inc. (Nouvelle), including of all of Nouvelle's current and future purchase orders and other assets of its seamless business. Nouvelle is a private Canadian manufacturer of mass market seamless apparel which has established a strong position in both private label and branded products with broad distribution through leading U.S. retailers.
Tefron strengthened its financial position with two other transactions completed yesterday. In the shareholders' meeting, investors approved a capital increase of $5.8 million. Separately, Tefron succeeded in its negations to modify its banking agreement, as a result of which Tefron will receive an additional $5 million in bank loans
Commenting on the transactions and shareholder approval, CEO of Tefron, Amit Meridor said, "The acquisition of Nouvelle's Seamless activities adds a new component to our global strategy of regaining Tefron's leading position in seamless apparel and performance apparel industry, particularly because it will help strengthen our sales and marketing network in the U.S. market. In addition, the $10.8 million of fresh capital and new bank loans now provides Tefron with a base of financial stability which will enable us to further build the company and develop other new markets. Yesterday's strong investor support for the transactions confirms the confidence of our shareholders in our goals and business plan set by the management team."
Tefron is a market leader in the field of apparel, serving customers in the U.S. and Europe. Tefron focuses on developing, producing, marketing and selling undergarments, athletic wear, beach and swimwear. Tefron activities are divided into two business sectors: "Seamless" design, development, production and sale of undergarments and athletic apparel; and "Cut & Sew" design, development, production and sale of undergarments, swimsuits and athletic apparel. The design and production are mainly performed in Israel, Jordan and the Far East, while the finished goods are sold mainly in the U.S. and Europe. Company customers include leading international players, such as: Hanes Brands Industries, Reebok, Patagonia, Lululemon Athletica, GAP, Calvin Klein, Wal-Mart, Victoria's Secret.
This press release contains certain forward-looking statements, within the meaning of Section 27A of the US Securities Act of 1933, as amended, Section 21E of the US Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995, with respect to the Company's business, financial condition and results of operations. We have based these forward-looking statements on our current expectations and projections about future events.
Words such as "believe," "anticipate," "expect," "intend," "will," "plan," "could," "may," "project," "goal," "target," and similar expressions often identify forward-looking statements but are not the only way we identify these statements. Except for statements of historical fact contained herein, the matters set forth in this press release regarding our future performance, plans to increase revenues or margins and any statements regarding other future events or future prospects are forward-looking statements.
These forward looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements, including, but not limited to:
- the effect of the worldwide recession on our sales to our customers in the United States and in Europe and on our ability to finance our operations; - our customers' continued purchase of our products in the same volumes or on the same terms; - the cyclical nature of the clothing retail industry and the ongoing changes in fashion preferences; - the competitive nature of the markets in which we operate, including the ability of our competitors to enter into and compete in the seamless market in which we operate; - the potential adverse effect on our business resulting from our international operations, including increased custom duties and import quotas (e.g., in China, where we manufacture for our swimwear division). - fluctuations in inflation and currency rates; - the potential adverse effect on our future operating efficiency resulting from our expansion into new product lines with more complicated products, different raw materials and changes in market trends; - the purchase of new equipment that may be necessary as a result of our expansion into new product lines; - our dependence on our suppliers for our machinery and the maintenance of our machinery; - the fluctuations costs of raw materials; our dependence on subcontractors in connection with our manufacturing process; - our failure to generate sufficient cash from our operations to pay our debt; - political, economic, social, climatic risks, associated with international business and relating to operations in Israel;
As well as certain other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Contacts Company Contact: Eran Rotem Chief Financial Officer +972-4-9900803 firstname.lastname@example.org
SOURCE Tefron Ltd