NEW YORK — An announcement is expected today that a deal has been struck between Calvin Klein Inc. and The Warnaco Group involving the sale or license of Klein’s highly profitable $85 million men’s underwear business.

Calvin Klein Inc. and Warnaco were said to be close to signing a deal last Friday (WWD, Jan. 14, Page 1).

The anticipated deal will combine two powerhouses in innerwear and underwear.

Klein owns his men’s underwear business, while his significantly smaller women’s underwear business is licensed to Heckler Manufacturing & Investment Group. The deal is not expected to affect the women’s license, according to sources.

The injection of cash into Calvin Klein Inc. could be used to help pay back a $58 million loan the firm received from Citibank last June. The loan was used to enable Klein to buy back his bonds from entertainment mogul David Geffen.