LONDON (ShareCast) - (Sharecast News) - HanesBrands said on Wednesday that it has agreed to sell its Champion business to Authentic Brands Group for up to $1.5bn.
The US apparel company has agreed to sell the business for $1.2bn, with the potential for the deal reach up to $1.5bn through an additional contingent cash consideration of up to $300m based on the achievement of performance thresholds.

Once the deal completes, HanesBrands plans to focus on extending its leadership position in the innerwear category and generating above-market growth "through continued consumer-centric product innovation and increased investment across its portfolio of leading brands, including Hanes, Bonds, Maidenform, and Bali".

Chairman Bill Simon said: "Following a thorough review of options for the global Champion business with the support of our financial and legal advisors, we are pleased to have reached this agreement with Authentic Brands Group that we believe maximises value for Champion and best positions HanesBrands for long-term success.

"Importantly, we believe this transaction will enable the company to accelerate its debt reduction while positioning HanesBrands to deliver consistent growth and cash flow generation through a focused strategy on advancing its leading innerwear brands and optimising its world-class supply chain."

At 1425 BST, HanesBrands shares were up 13% in pre-market trade at $5.71.

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