Arvind Mills lines up revamp of textile brand portfolio

Anindita Dey & Anju Ghangurde

Mumbai, Sept 12: Arvind Mills Ltd, the flagship company of the $550-million Lalbhai Group, is believed to be working on plans to revamp its textile brand portfolio. The proposed revamp is expected to cover well-known brands like Lee, Arrow and extend to strategic growth plans for home-grown brands like Ruggers, Flying Machine, Excaliber, etc.

Industry sources say that a prominent investment banking group has been sounded out to assist the Arvind group in its effort, though many of these plans are still in the early stages. It may also involve roping in a strategic partner for part of Arvind Brands (where Arvind holds a 60 per cent stake) equity, though this could not be officially confirmed.

In a faxed response to The Financial Express, Arvind Mills chief financial officer Jayesh Shah said, “We would like to reiterate that Arvind Mills is not planning to divest out of any of its brands. Arvind Brands is a very important part of Arvind’s textile portfolio. It’s current year turnover is expected to be approximately Rs 350 crore, an increase of about 30 per cent over last year.

Contrary to what you have stated, Arvind Brands is in expansion mode. It has already launched the Wrangler brand last year and is in the process of launching a new brand for children wear called Healtex some time during this year.”

Arvind Mills had gone in for a major revamp of its debt last year. Before that, it had offloaded its brand into a separate company at a valuation of approximately Rs 300 crore. With this divestment, Arvind continues to hold 60 per cent equity of the company. Sources, however, say issues under consideration may include a revamp of brand licensing rights for Lee, Arrow, and/or other similar arrangements. Both these profitable brands are not owned by Arvind, but licensed from VF Corporation (Lee), and Cluett Peabody & Co (Arrow). Typically an Arrow licensee agreement allows a licensee to use the Arrow brand and identifies all licensed products and related promotions.

Cluett International provides artwork, color palettes, lifestyle photography, long-term trend intelligence, and details regarding the use of labels and associated trademarks, etc. Arrow and the associated Arrow brands are protected with trademark coverage and sales in more than 90 countries around the world.

The Arvind group’s Lee merchandise is among the most comprehensive ones and includes denim and jackets, overalls, shorts, denim shirts, twill shirts, T-shirts, Pique polos, skirts, carpenter pants and accessories-belts, bags and caps.