NEW YORK — Sara Lee Corp. said on Monday that it agreed to sell its European branded apparel division to an affiliate of the private investment firm Sun Capital Partners Inc. in a cash deal valued at 100 million euros, or about $117.5 million at current exchange rates.
Under terms of the agreement, the Sun Capital affiliate will pay Sara Lee the purchase price in cash plus potential contingent payments based on the future performance of the business under the ownership of Sun Capital. Sara Lee would receive 49 percent of the first 204 million euros, or $239.6 million, of cash distributed from the business after the close of the transaction. The deal is expected to close by the end of January. Sun Capital would assume pension and related liabilities totaling about 70 million euros, or $82.2 million.
Sara Lee Courtaulds, the U.K.-based division that manufactures private label apparel for retailers, is not a part of the sale. Sara Lee Corp. also will not retain any equity interest in the European branded apparel businesses that it is selling to the Sun Capital affiliate after the close of the deal.
“We are pleased with the economics of this deal and are happy to share in the future growth of the business under the Sun Capital affiliate’s ownership,” Brenda C. Barnes, chairman and chief executive officer of Sara Lee, said in a statement. “This divestiture is another key step in our transformation, which is a bold and ambitious plan designed to simplify Sara Lee and focus on our core food, beverage and household and body care businesses.”
Sara Lee’s European branded apparel businesses had sales of $1.2 billion in its latest fiscal year. The company’s brands include Dim, Playtex, Wonderbra, Abanderado, Nur Die and Unno.