Mumbai, Sept. 1: Arvind Brands, the wholly owned subsidiary of Ahmedabad-based Arvind Mills, has entered into a joint venture with VF Corporation to market the American company’s brands in India. VF Corporation will hold a 60 per cent stake in the joint venture for which it will pay $33 million, while Arvind will own the rest.

The new company will be called VF Arvind Brands. The existing business, including intellectual assets and licences from VF Corporation for Lee, Wrangler, Nautica, Jansport and Kipling brands, currently held by Arvind Fashions Ltd (also a subsidiary of Arvind Mills) will be transferred to the joint venture. The company, headquartered in Bangalore, will have about 180 employees.

According to a statement from Arvind, the joint venture will design, source and market the existing licensed brands and may add a few more brands of VF Corporation in future. The retailing and the stores infrastructure will continue to be held by Arvind. Arvind Brands president Darshan Mehta will be CEO of the new company.

Chief financial officer and director Jayesh Shah said “The transaction strengthens the relationship of Arvind and VF Corporation. This is a pointer to the faith in the future of branded retailing in India. The new company, with far greater input from VF Corporation, will be a force to reckon with in the domestic branded apparel and accessories market.”

VF Corporation is a major player in branded lifestyle apparel, including jeanswear, outdoor products, apparel and sportswear. Its principal brands include Lee, Wrangler, Riders, Rustler, Vanity Fair, Vassarette, Bestform, Lily of France, Nautica, John Varvatos, JanSport, Eastpak, The North Face, Vans, Reef, Kipling, Lee Sport and Red Kap.

Lee, Wrangler, Nautics, JanSport and Kipling were earlier marketed under licensing and distribution agreements with Arvind Fashions. Though Arvind did not comment on the brands to be launched over the next few months, it is speculated that brands like Vanity Fair and Lee Sport will enter the country.

“Arvind’s strong distribution network helps us enter one of the world’s most dynamic and fastest growing markets,” said Mackey J. McDonald, chairman and chief executive officer of VF Corporation. He said with its rapidly expanding economy, growing retail base and favourable demographic characteristics, India is a source of enormous growth for the company's brands.

VF Corporation’s wholesale business in India with its Lee, Wrangler, Nautica, JanSport and Kipling brands is approximately $40 million annually and is expected to grow more than 25 per cent per year, excluding the addition of other VF brands.

According to Mehta, the branded apparel market in India is approximately $4.4 billion and continues to grow as consumers are becoming increasingly brand and fashion conscious.

Recently, VF Corporation formed an international leadership team as part of its initiative to enter new markets, including Asia.