Kontoor Brands has agreed to divest the Lee brand to Authentic Brands Group in a deal worth up to $1 billion as the company shifts focus to Wrangler and Helly Hansen.
Kontoor Brands has signed a definitive agreement to divest its iconic denim label Lee to Authentic Brands Group in a deal valued at up to $1 billion.
The transaction includes an initial payment of $750 million along with a potential performance-based earnout of $250 million linked to Lee’s future business performance under Authentic’s ownership.
Kontoor launched a competitive process to divest the Lee business during the first quarter of 2026. The move came as Lee’s annual revenue declined 5% in fiscal 2025 to nearly $750 million.
Following the divestment, Kontoor plans to concentrate more strongly on its remaining core brands, including Wrangler and Helly Hansen.
Scott Baxter, president, chief executive officer, and chairman of Kontoor Brands, said the transaction is designed to sharpen the company’s portfolio and unlock greater investment capacity for future growth.
Kontoor also said the transaction will allow the company to focus more resources on its denim, outdoor, and workwear categories while strengthening investments in higher-performing business segments.
The deal also highlights Authentic Brands Group’s continued expansion in the apparel sector. Last year, Authentic acquired Dockers from Levi Strauss & Co. in a $311 million transaction. Industry reports have also linked the company with a potential interest in acquiring Converse from Nike.
