Hampshire Group announces agreement to sell its Rio Garment business
Hampshire Group announced on Monday that it has entered into an agreement to sell its stock of Rio Garment S.A. to a group led by current Rio Management, including the President of Rio, David Gren.
The purchase price of the equity is $6 million, and Hampshire Group will receive the existing accounts receivable and other Rio assets worth $5 million.
A Honduras-based apparel manufacturer, Rio designs, sources and manufactures knit tops for men, women and children, which are sold to
retailers and distributors, primarily in the United States.
"The beginning of 2015 has been a very difficult time at Hampshire with significant delays caused by the west coast port strike and events that led to a change in our CFO, which has adversely affected the Company’s liquidity," said Paul Buxbaum, Chief Executive Officer of Hampshire Group."
"The decision to sell the assets of Rio will strengthen the company’s financial position and allow management to focus on growing the core business, which includes Dockers and new brands such as James Campbell," he added
Hampshire acquired Rio in 2011 for an aggregate purchase price of $23 million.
The company anticipates the transaction will close before the end of April.
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