Wrangler Owner Looks to Exit Jeans Business
August 10 2018 - 3:41PM
Dow Jones News
By Dana Mattioli and Suzanne Kapner
VF Corp., owner of Lee and Wrangler jeans, is exploring
strategic options for its denim business that could include a sale
or spin off of the classic American brands, according to people
familiar with the situation.
The apparel conglomerate has owned Wrangler and Lee for decades
and they were once its core, but the company's jeans sales have
slowed in recent years as more women opt for yoga pants or premium
denim brands like J Brand or Frame.
VF, which has a market valuation of $38 billion, has been
pairing back its wide-ranging portfolio to focus on its fastest
growing brands, such as Vans sneakers, The North Face jackets, and
Timberland boots.
VF's denim business last year had $2.66 billion in sales and
$422 million in profit. A typical multiple in the apparel industry
could value the business at several billion dollars. It isn't clear
what other brands might be part of the company's review.
The overall U.S. jeans category had total sales of $16.2 billion
in 2017, down from $18.8 billion in 2013, according to Euromonitor
International. One big brand bucking the downward trend is Levi
Strauss & Co., whose revenue increased 8% in its most recent
fiscal year.
VF's jeans division, which also includes the Rustler and Rock
& Republic brands, hasn't fared as well. Sales have fallen
nearly 5% since 2015, while profit in the division is down 2% over
that period.
Write to Dana Mattioli at dana.mattioli@wsj.com and Suzanne
Kapner at Suzanne.Kapner@wsj.com
(END) Dow Jones Newswires
August 10, 2018 15:26 ET (19:26 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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