Bonny International (HKG:1906) said it agreed to sell its loss-making Brand Products business to its controlling shareholder's son, according to a Hong Kong bourse filing Friday.

Shares of the intimate wear firm gained nearly 2% in morning trade Monday.

The firm said it would sell Bonny HK, the holding company of its Brand Products business, to Jin Bo for a cash consideration of 241.7 million yuan.

According to Bonny International, the sale will help eliminate the "ongoing drag on profitability" from the business on its books. It will also help raise funds for the company's general working capital.

As Bonny HK owns the property where Bonny International manufactures its standard products, the firm said it plans to enter a three-year lease agreement to continue operating from the space.

The firm will pay 8.4 million yuan in annual rent for the space, according to Bonny International.

Meanwhile, Bonny International will enter a framework with Bonny HK to manufacture products for the to-be-disposed unit for a period of three years.

The framework will have proposed caps of 8.5 million yuan per year.