Lee, Wrangler Owner VF To Spin Off Denim Business
VF Corp. (VFC), the owner of Lee and Wrangler jeans, plans to spin off its denim business in to a separate company.
VF said the yet-to-be named company will hold VF’s Jeans and VF Outlet businesses. The company plans a tax-free spin-off of the new company to VF’s shareholders.
VF’s jeans business includes Wrangler, Lee, Rustler and Rock & Republic brands and 80 VF outlet operations. These businesses generate over $2.5 billion in annual revenues.
VF had forayed into the denim business in 1969 with the acquisition of Lee. The company later added Wrangler, Rustler and JanSport to its denim portfolio after the acquisition of Blue Bell Holding Co. in 1986.
CEO Steve Rendle said, “In alignment with our strategic plan, the decision to separate these businesses will allow VF to sharpen its focus as a consumer-centric and retail-minded organization anchored in activity-based lifestyle brands.”
“Our Jeans platform is a successful, sustainable business with iconic global brands and a clear path to value creation as a standalone entity.”
The company also expects to appoint Scott Baxter as Chief Executive Officer of the new company and Rustin Welton as Chief Financial Officer.
The company plans to announce additional members of the new company’s executive team and additional details of its Board of Directors ahead of the completion of the transaction.
The new company’s global headquarters will be in Greensboro, North Carolina, and the Lee brand will move its headquarters to Greensboro from Kansas City, joining the Wrangler brand.
The company expects the spin off to be completed in the first half of 2019, subject to final approval by the Board of Directors, customary regulatory approvals and tax and legal considerations.
Barclays is acting as financial adviser to VF Corp.
VFC is currently trading at $92.39, down $3.96 or 4.11% on the NYSE.
by RTTNews Staff Writer
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