Delta Apparel (NYSE:DLA) shares surged by nearly 20% in the pre-market session today after the activewear and lifestyle apparel provider received an unsolicited offer for its Salt Life business unit. The company has roped in Baird to advise on the transaction.
Delta acquired Salt Life in 2013. Since then, the unit has grown its top line to $60 million, with a consumer presence in both the U.S. and internationally. Salt Life offers its products at more than 1,700 wholesale points as well as via online channels.
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While the company noted that there can be no assurance regarding the timing or structure of a potential transaction, Bob Humphreys, its Chairman, and CEO, commented, “Our Board of Directors and management team are committed to maximizing value for Delta Apparel shareholders, and we believe it is in their best interests to conduct a thorough review of strategic options for our Salt Life business given the widespread interest in it.”
Today’s price gain comes after a nearly 53.6% slide in Delta shares over the past year. While the company’s top line has grown steadily over the past three years, its bottom line has been mixed, indicating pressure on its margins.
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