Canadian Tire shifts focus to its retail business while Kontoor plans to expand Helly Hansen in the US
Canadian Tire Corp. Ltd. has reached an agreement to sell Helly Hansen to US-based Kontoor Brands in a deal valued at nearly $1.3bn, according to BNN Bloomberg.
The company stated that this decision allows it to concentrate on its Canadian retail operations while delivering value to shareholders.
Kontoor, which owns Wrangler, Lee, and Rock & Republic, will acquire full ownership of the sportswear brand.
Canadian Tire acquired Helly Hansen in 2018 for $985m from the Ontario Teachers’ Pension Fund, also assuming $50m in debt.
The Norwegian brand, founded in 1877 by sea captain Helly Juell Hansen and his wife Margrethe, initially produced waterproof gear before expanding into ski, snowboard, sailing, and workwear apparel.
Company president and CEO Greg Hicks emphasized that the sale aligns with Canadian Tire’s evolving priorities.
“As our strategy becomes more singularly focused on great Canadian retail, it is time to pass this iconic brand into global hands,” he said in a statement.
The company framed the sale as a move that reinforces its commitment to strengthening its retail operations across SportChek, Mark’s, Party City, and Pro Hockey Life.
RBC Capital Markets analyst Irene Nattel recalled that the acquisition was unexpected at the time, as it signaled a shift away from Canadian Tire’s core focus.
“Investors questioned whether (Canadian Tire) had the right tools to capitalize on/further develop a global brand,” she wrote in a note to investors.
She noted that Canadian Tire initially saw Helly Hansen as a way to enhance its product offerings and extend its brands internationally.
However, she observed that this expansion did not materialize as the company shifted its focus back to strengthening its Canadian retail portfolio. Given this shift, she said selling Helly Hansen now makes strategic and financial sense.
Hicks told analysts last week that consumer spending had started to improve after a period of economic pressure, but recent US tariff threats had reversed much of that progress.
He added that the company is preparing for further economic uncertainty, pointing to the impact of mortgage renewals on consumer budgets and the declining value of the Canadian dollar, which could affect foreign exchange rates.
Kontoor Brands CFO Joe Alkire stated that Canadian Tire had been “a great steward” of Helly Hansen but believes his company is a better fit for the brand.
“The brand’s pain points in many ways are our largest strength,” he told analysts on a call Wednesday.
He cited supply chain, sourcing, logistics, and distribution as key areas where Kontoor can provide advantages.
“We’ve got the plumbing built, and now they can plug into our model in a very frictionless way versus investments they really were trying to make on their own as a standalone business,” he said.
Alkire also sees Helly Hansen as a way for Kontoor to diversify its portfolio. He noted that the outdoor market is “significantly larger” than the denim sector, where Kontoor’s existing brands operate.
He also highlighted the brand’s potential for expansion in the US, where he said Helly Hansen remains “significantly under penetrated relative to its peers.”
While Kontoor is headquartered in Greensboro, North Carolina, it also has major offices in Switzerland and China.
Although Helly Hansen will change ownership, Canadian Tire confirmed that the brand will maintain a presence in Canada.
As part of a supply agreement signed alongside the sale, Canadian Tire and its retail banners will continue selling Helly Hansen products.
The deal is expected to close in the second quarter of 2025, pending regulatory approvals and customary closing conditions.
