Kontoor strikes one billion dollar deal to sell Lee to Authentic Brands Group

US denim specialist Lee Jeans is set to change hands. Parent company Kontoor Brands has confirmed it has signed an agreement with Authentic Brands Group to sell the business for up to one billion dollars.

The definitive deal, which has been approved by Kontoor’s board of directors, includes an initial transaction value of 750 million dollars and a 250 million dollar earnout based on Lee’s future performance under Authentic. The transaction is expected to close in the second half of 2026 and remains subject to regulatory approvals and closing conditions.

In a statement, Kontoor’s president, CEO and chairman, Scott Baxter, described the divestment as a "deliberate step to sharpen our brand portfolio and unlock investment capacity to fuel accelerated growth”.

Kontoor had already confirmed plans to separate from the Lee brand in its financial report for 2026, in which Lee had already been classified as a discontinued operation. At the time, Baxter had said the move looked to align the group’s portfolio “towards a higher growth profile”.

Kontoor repositions towards ‘higher growth profile’

Rumours about potential bidders then began circulating, with Authentic reported as a frontrunner in the takeover race. By adding Lee to its portfolio, the US multibrand giant is extending its long-term streak of snapping up notable labels, placing the brand alongside the likes of Guess, Dockers, and Boardriders.

Authentic itself has seen significant growth, with sales outpacing a prior five-year goal of achieving 100 billion dollars in sales and whispers of an IPO filing beginning to spread.

At Kontoor, meanwhile, the team is pivoting its attention towards Wrangler and Helly Hanson, two brands Baxter said have “significant white space opportunities”. As a result of the deal, the company will now be “better positioned to fuel a higher growth profile” in segments like denim, outdoor and workwear.

Alongside a newly streamlined brand portfolio, Kontoor is also aiming to enhance its profitability profile, strengthen its balance sheet, enable disciplined reinvestment and enhance its commitment to long-term value for shareholders.

Baxter added: “I want to reinforce our commitment to support Lee through the sale process and to 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.”