Champion no longer belongs to HanesBrands (asi/59528).

The Winston-Salem, NC-headquartered global apparel manufacturer announced Monday, Sept. 30, that it has completed the sale of the athleticwear brand to Authentic Brands Group (ABG).

HanesBrands initially announced the deal in June, but it still needed to close.

That’s now officially occurred, with the intellectual property and certain operating assets of Champion going to ABG for a reported $1.2 billion. HanesBrands could ultimately bring in a total of $1.5 billion from the sale of the sportswear line through an additional contingent cash consideration of up to $300 million based on the achievement of certain performance thresholds.

“Today marks a major milestone on our journey to strengthen and simplify our business and is the culmination of a significant team effort to position HanesBrands on the optimal path for the future,” said Hanes CEO Steve Bratspies.

During a transition period, HanesBrands will reportedly provide certain continued services for Champion, including operating the business in select regions.

Bratspies said HanesBrands plans to use money from the transaction, along with cash already on hand, to pay down approximately $1 billion in debt before the end of 2024.

“Looking ahead, we believe we are well-positioned to generate strong shareholder returns over the next several years through top-line growth, margin expansion, double-digit earnings per share growth and further deleveraging of our balance sheet,” the CEO said.

HanesBrands has been sorely lacking in such strong financial performance of late. Continuing a run of rough results, the publicly traded company reported sales declines of 4% in the second quarter of 2024 and 17% in the first quarter of the year.

For full-year 2023, HanesBrands had a year-over-year sales decrease of nearly 10%, with a recorded $17.7 million loss.

Still, executives believe the turnaround is underway, signaled by the sale of Champion, debt reduction and plans to run a streamlined business that generates returns.

“We believe our earnings growth potential and continued debt paydown positions us to unlock significant shareholder value,” Bratspies has said.

Headquartered in New York City and private equity-owned, ABG’s portfolio includes Aéropostale, Bandolino, Billabong, Brooks Brothers, Eddie Bauer, IZOD and Van Heusen.