In a Thursday interview with CNBC’s Jim Cramer, Kontoor Brands CEO Scott Baxter explained why the apparel company purchased outdoor and workwear outfit Helly Hansen, citing growth potential and an expansion of the company’s offerings.
“This is, far and away, the largest outdoor market in the world, right,” Baxter said. “And here we’ve got a small business that we can make much larger.”
Kontoor Brands is known for denim names Wrangler and Lee. In 2019, the company spun off of from VF Corp, another apparel outfit, which owns Timberland, Vans and North Face brands. Kontoor Brands announced on Wednesday that it would acquire Helly Hansen for about $900 million, saying in a press release it expects the brand to generate more than $680 million of revenue in full year 2025.
According to Baxter, Kontoor Brands had been looking for outdoor and workwear brands, and Helly Hansen fell into both of those categories, adding that the segment is growing a little bit faster than the denim business. Helly Hansen is popular in Europe and Canada, Baxter continued, saying the company has strong growth potential abroad and in the U.S. Merchandise from Helly Hansen will be sold to wholesalers, in retail stores and online, he said.
Baxter also tried to assuage concerns about how President Donald Trump’s intended tariffs might impact business, claiming that the company is prepared for such challenges. Trump has threatened to raise tariffs on goods from a number of countries, including where Kontoor Brands and many peers manufacture clothing.
“We’ll be ok, we’ve got a really strong back end. We have a plan, you know, we know what we’re going to do if that does come in place, and we’re in a really good place with our consumer right now,” Baxter said. “So, I feel real confident no matter what happens.”
