Arvind Brands forms a joint venture with VF Corporation, USA for marketing VF brands in India

Arvind Mills Ltd has announced that Arvind Brands Ltd, the wholly owned subsidiary of the Company has agreed to form a Joint Venture (JV) with VF Corporation, USA for marketing in India, various brands owned by VF Corporation. In this JV company, which will come into effect on September 01, 2006, Arvind will hold 40% equity and VF Corporation will pay USD 33 million for the balance 60% equity in the new company. The new company will be called VF Arvind Brands Pvt Ltd. The existing business including intellectual assets and existing licenses from VF for Lee, Wrangler, Nautica, Jansport and Kipling brands, currently held by Arvind Fashions Ltd will be transferred to this new company.

The new company will be handling the designing, sourcing and marketing of the existing licensed brands and in the future may add a few more brands belonging to VF Corporation. The retailing and the stores infrastructure will continue to be held by Arvind. Mr Darshan Mehta currently the President of Arvind Brands will be CEO of the new company.

Commenting on the transaction Mr Jayesh Shah, Chief Financial Officer and Director said, "The transaction further strengthens the relationship Arvind shares with VP Corporation and is a pointer to the faith in the future of branded retailing in India. The new company with far greater input from VF will be a force to reckon with in domestic branded apparel and accessories market."

Source : Equity Bulls

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