Hampshire Group to sell Rio Garment business

04 May '15

1 min read

Hampshire Group, Limited has entered into a definitive agreement to sell the stock of Rio Garment S.A. ("Rio") to a group led by current Rio management, including David Gren, the President of Rio, it said in a statement. The deal is expected to improve Hampshire Group’s cash flow which was facing liquidity problems.

The purchase price of the equity is $6 million plus Hampshire Group will receive the existing accounts receivable and certain other assets of Rio totaling approximately $5 million.

Rio is a Honduras-based apparel manufacturer, designing, sourcing and manufacturing knit tops for men, women and children, which are sold to retailers and distributors, primarily in the US.

“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. Our opportunistic sale of the Rio Garment business will provide significant liquidity to our operations, while materially reducing the working capital requirements of the overall company,” Paul Buxbaum, Chief Executive Officer of Hampshire Group said. (SH)

Fibre2fashion News Desk - India

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