The transaction is expected to close in the third quarter. Berkshire, a 15-year-old private equity investment firm, has signed a definitive agreement on the purchase with Investcorp, the companies say in a prepared statement. Berkshire is buying the apparel company from Investcorp and its clients.

Berkshire's equity investment in the deal will be about $130 million.

"Over the course of our 4 ½-year partnership with Investcorp, Carter has made substantial operating and financial progress and has further established the Carter's family of brands as the most innovating and popular in the children's apparel sector," Frederick J. Rowan II, Carter's chairman/CEO/president, says in a prepared statement. Rowan expects his company to benefit from Berkshire's experience with branded and retail-oriented companies.