NEW YORK, United States — Differential Brands Group Inc said on Wednesday it would buy most of Hong Kong-based Global Brands Group Holding Ltd's North American licensing business for $1.38 billion in cash.

The deal will give Differential Brands access to licenses for brands, including Disney, Calvin Klein, Under Armour and Michael Kors, and help boost its pro forma annual revenue to more than $2.3 billion, the company said in a statement.

Shares of California-based Differential, which has a market capitalisation of about $12 million as of Tuesday's close, surged to $4.94 in premarket trading on Wednesday after closing at 89 cents a day earlier.

The transaction will be financed by Ares Capital Management LLC, HPS Investment Partners LLC and GSO Capital Partners LP.

Certain members of Global Brands' existing management team, co-investors and lenders will also invest in Differential Brands as part of the deal.

Following the closure of the deal, expected in the third quarter, Differential Brands' biggest shareholder, Tengram Capital Partners LP, will convert all of its preferred stock into common stock.

By Aishwarya Venugopal; Editor: Anil D'Silva.