Authentic Brands Group Acquires Lee® in $1 Billion Deal as Kontoor Refocuses on Wrangler and Helly Hansen

Authentic Brands Group (ABG), a New York-based global brand and entertainment platform, has signed a definitive agreement to acquire Lee, one of the world’s most recognized denim and casual apparel brands, from Kontoor Brands, Inc. (NYSE: KTB). The transaction, announced on May 21, 2026, is expected to close in the second half of the year, subject to customary regulatory approvals. The deal is valued at up to $1 billion, including an initial transaction value of $750 million and a $250 million earnout opportunity based on Lee’s performance under ABG’s ownership.

Lee, founded in 1889, has built a legacy as a pioneer in denim and workwear, known for its craftsmanship, innovation, and timeless style. The brand currently generates approximately $1.5 billion in annual retail-equivalent sales across 73 countries, with nearly 40% of revenue coming from markets outside the US and Canada.

Authentic Brands Group plans to transition Lee into a licensing model, leveraging its extensive network of over 1,700 partners and its expertise in brand building, marketing, and storytelling. This approach aims to expand Lee’s presence across content, experiences, and heritage-driven lifestyle categories, while preserving the brand’s cultural relevance and consumer loyalty.

Jamie Salter, Founder and Executive Chairman of ABG, emphasised Lee’s enduring appeal: “What makes Lee so compelling is its legacy. It’s one of the most important names in denim, with more than a century of heritage, consumer awareness and cultural relevance already built in. At Authentic, we focus on preserving what consumers love about their favourite brands while putting the right partners, distribution and marketing strategies behind them to drive long-term growth.”

For Kontoor Brands, the divestiture of Lee is a deliberate strategic step to sharpen its brand portfolio and unlock investment capacity to fuel accelerated growth. Scott Baxter, President, CEO and Chairman of Kontoor, described the transaction as a move to increase focus on Wrangler® and Helly Hansen® — two iconic brands with significant white space opportunities — better positioning the company for a higher growth profile and greater shareholder value. Transaction proceeds are anticipated to be deployed through increased share repurchases under Kontoor’s $750 million authorisation, as well as voluntary term loan payments, while also creating capacity for disciplined reinvestment behind organic growth opportunities.

Authentic Brands Group operates a diversified portfolio of over 50 brands, including Reebok, Champion, and Nautica, generating more than $36 billion in annual systemwide retail sales worldwide. The company’s digital-first, asset-light platform integrates culture, commerce, and technology to cultivate brand fandom through storytelling and premium content.

Advisors: Morgan Stanley & Co. LLC and Foley & Lardner LLP advised Kontoor Brands. ABG is represented by Kirkland & Ellis LLP, with Morgan Stanley also acting as financial advisor to the transaction.

The acquisition strengthens ABG’s position in the global apparel market, particularly in denim and workwear segments. By integrating Lee’s heritage brand into its licensing and marketing platform, ABG aims to enhance product innovation, expand geographic reach — especially in Asia-Pacific, Europe, Latin America, and the Middle East — and drive growth through digital and e-commerce channels.

Industry analysts note that this deal accelerates consolidation in the apparel sector, increasing competitive pressure on other denim brands. Competitors may respond with similar acquisitions or increased investments in direct-to-consumer strategies and product innovation.

Looking ahead, ABG faces integration challenges such as aligning Lee’s brand identity with its portfolio strategy, managing legacy supply chains, and retaining key talent. Successful execution will be critical to preserving Lee’s brand equity and realising synergies across marketing, distribution, and operations.

Upon closing, ABG plans to collaborate with leading brand operators to support Lee’s existing business and explore new opportunities in lifestyle and heritage-driven categories. The transaction marks a significant step in ABG’s ongoing strategy to expand its global brand portfolio and capitalise on the growing demand for authentic, heritage-rich apparel brands.