VF Corporation will create a spin-off company with a separate management team for its denim and outlet businesses.
The new, publicly traded company is yet to be named but will house the Lee and Wrangler brands, leaving the original company to focus on brands including Vans and The North Face.
US-based VF Corp outlined its five-year growth plan in 2017, including the acquisition of Williamson-Dickie, the Icebreaker and Altra brands and the sale of the Nautica and the Licensed Sports Group, including the Majestic brand.
The original VF company will move its headquarters to Denver, Colorado, close to the Rocky Mountains, to enhance its focus on the outdoor and active consumer. This new base will be home to The North Face, JanSport, Smartwool, Altra and Eagle Creek, as well as the VF Global Innovation Center for technical fabrics and its Digital Lab.
The new company will be based in Greenboro, North Carolina, and Lee will move to this location to join Wrangler. Scott Baxter, currently group president for Americas West at VF, will become chief executive of the new company, and finance executive Rustin Welton will become chief financial officer when the transition completes.
“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 organisation anchored in activity-based lifestyle brands,” said Steve Rendle, chairman, president and chief executive of VF Corp. “Our jeans platform is a successful, sustainable business with iconic global brands and a clear path to value creation as a standalone entity.
“This exciting step forward will mean that both VF and [the new company] have the resources, management focus and financial flexibility to thrive in a dynamic consumer marketplace, creating an even brighter future for both organisations and all of their stakeholders.”