Levi Strauss & Co. (NYSE:LEVI) is selling its Dockers brand to Authentic Brands Group for an upfront payment of $311 million, with the potential for the deal’s total value to reach $391 million, depending on future performance metrics tied to an $80 million earnout.

This move marks a significant step in Levi’s broader strategy to streamline its operations and double down on its core brand, while strengthening its direct-to-consumer and global growth initiatives. Dockers, long associated with business-casual menswear, has been a notable part of Levi’s brand portfolio but is now being divested as the company looks to sharpen its focus.

“We’re concentrating our resources on areas where we can win, and Dockers has not been a top growth driver,” said Levi CFO Harmit Singh, noting the company’s effort to boost operational efficiency and overall brand alignment.

Authentic Brands, known for acquiring and revitalizing well-established labels, plans to breathe new life into Dockers by expanding its reach across more product categories and leveraging its established consumer following. Levi CEO Michelle Gass emphasized that the decision aligns with Levi’s strategy of focusing on the Levi’s brand while reducing operational complexity.

The transaction is set to close in two phases. The first, covering Dockers’ intellectual property and business operations in the U.S. and Canada, is expected to complete by July 31, 2025. The second phase, involving the rest of the brand’s global operations, is slated to wrap up by January 31, 2026.

As part of the transition, Levi Strauss will provide support services to Authentic Brands and its affiliates for a limited period to ensure a smooth handover. The company plans to allocate roughly $100 million of the proceeds from the sale toward a stock buyback initiative.

Levi Strauss stock price