Gold Toe, Moretz To Combine

by MR Magazine Staff

NEW YORK – Two major hosiery houses will now reside under the same roof.

Gold Toe Investment Corp. and Moretz Inc., both based in North Carolina, will join forces through a deal in which The Blackstone Group will acquire Gold Toe and help to finance the combination. Blackstone subsequently will become the majority owner of the new entity and John Moretz, chief executive officer, will be the second largest shareholder. An affiliate of Vestar Capital Partners, Gold Toe’s current principal owner, will retain a minority stake following consummation of the merger.

Details of the transaction weren’t disclosed, although the principals said that Gold Toe’s indebtedness would be refinanced.

Without disclosing its volume, principals in the transaction said the new firm will be among the largest sock companies in the world and enjoy distribution in numerous geographic markets and channels of distribution.

While Gold Toe is best known for its high-end socks under that brand, Moretz’s products are sold in discount, specialty and department stores under a broad assortment of licensed and in-house labels. It holds licenses for brands including Kathy Ireland, New Balance, Under Armour and Coleman and, through its Mass Market division, produces hosiery under private labels including Cherokee, Gap, Old Navy, Gap, Exhilaration, Merona and Faded Glory.

During its 21-year history, Blackstone has raised more than $63 billion, about half of that amount for private equity investments.

Current management of the two firms is expected to be retained. “By leveraging the management teams, the brands and the distribution capabilities of Gold Toe and Moretz, we will create the industry leader and the fastest-growing hosiery company in the United States,” said Ben Jenkins, principal of Blackstone’s private equity group.