Bankrupt children's clothing maker Kleinert's Inc is to sell its sleepwear division to Russell-Newman Inc for $4. million.

The deal has been approved by the US Bankruptcy Court and is expected to close on 16 May 2003.

Chairman and CEO Gregory A Sandfort said that he is pleased with the sale of the Kleinert's sleepwear division as it is the "best outcome for the value of the estate and the employees."

The company, which provides branded and private label children's and infants' sleepwear and playwear, also confirmed that with its $24 million DIP facility it has the full support from its bank group to fund the ongoing operations.

It will now focus its efforts on organising the sale of the Buster Brown playwear division, which is expected within the next 60 to 90 days.

Kleinert's Inc and four affiliates filed voluntary petitions for Chapter 11 reorganisation on 7 May 2003.