The US denim specialist Lee Jeans is facing a change of ownership. Parent company Kontoor Brands has confirmed it has signed an agreement with Authentic Brands Group to sell the company for up to $1 billion.
The final agreement was approved by Kontoor’s Board of Directors. It includes an initial transaction value of $750 million and an earn-out payment of $250 million, which is contingent on Lee’s future performance under Authentic. The transaction is expected to close in the second half of 2026 and is subject to customary regulatory approvals and closing conditions.
In a statement, Scott Baxter, president, chief executive officer (CEO) and chairman of Kontoor, called the divestiture a “conscious step to sharpen our brand portfolio and free up investment capacity to drive accelerated growth.”
Kontoor had already confirmed plans to separate from the Lee brand in its financial report for 2026. Lee was already classified as a discontinued operation. At the time, Baxter said the move was intended to “align the group’s portfolio towards a higher growth profile”.
Kontoor’s reorientation towards a ‘higher growth profile’
Rumors then began circulating about potential bidders. Authentic was considered the favorite in the takeover race. With the addition of Lee to its portfolio, the US multi-brand giant is continuing its long-standing series of acquisitions of well-known labels. The brand now joins names like Guess, Dockers and Boardriders.
Authentic itself has grown significantly. Sales exceeded the previous five-year target of $100 billion. Rumors of an IPO are also growing louder.
At Kontoor, meanwhile, the team is concentrating on Wrangler and Helly Hanson. According to Baxter, these two brands offer “significant growth opportunities.” The agreement means the company is now “better positioned to drive a higher growth profile in segments such as denim, outdoor and workwear”.
In addition to a newly streamlined brand portfolio, Kontoor also aims to improve its profitability profile; strengthen its balance sheet; enable disciplined reinvestment and increase its commitment to long-term value for shareholders.
Baxter added: “I would like to reiterate our commitment to supporting Lee throughout the sale process and personally thank the Lee team for getting us to where we are today. We believe this is a great outcome for Kontoor, the Lee business and Authentic.”
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