Wesfarmers keeps workwear onshore

The deal marked Pacific Brands' exit from the workwear market and came just seven years after the clothing and textiles distributor paid the Laidlaw family $250 million to add Yakka to its King Gee and Stubbies brands.

Favoured by construction workers, miners and farmers, Hard Yakka, King Gee and Stubbies work shorts, safety jackets and boots once accounted for 50 per cent of the workwear market and one-third of Pacific Brands' annual sales.

But the downturn in the resources and construction industries and a flood of copy-cat and private label brands have taken their toll. Workwear earnings fell 41 per cent in 2014 to $22 million and the division lost $247 million after PacBrands slashed the value of goodwill by $270 million.

Former chief executive John Pollaers, who quit last month after a dispute with the board over the company's direction, was keen to retain workwear because of its links with PacBrands' heritage and because it reduced the group's reliance on discount department stores.

However, PacBrands' new chief executive, David Bortolussi, said Wesfarmers made an offer that was too good to refuse. The sale simplifies PacBrands' business structure and clears the way for management to focus on its biggest and most profitable brands, Bonds and Sheridan.

The acquisition makes sense for Wesfarmers, cashed up after selling its insurance operations for $3 billion,has strong links to the mining and agriculture sectors and is keen to expand its existing workwear and safety businesses, which includes Blackwoods and Protector Alsafe. Wesfarmers' Industrial and Safety managing director Olivier ­Chretien said Wesfarmers planned to take the business into new segments in industrial and corporate workwear in Australia and New Zealand and expand into markets overseas including the UK.

"It is highly complementary and consistent with WIS's strategic agenda of building a more efficient and customer-centric business and developing new growth platforms," Mr Chretien said.