Planet Retail has exited franchise agreements with three fashion brands – departmental store chain Debenhams and fashion brands Nautica and Next – as part of its business restructuring exercise.
Planet Retail has exited franchise agreements with three fashion brands – departmental store chain Debenhams and fashion brands Nautica and Next – as part of its business restructuring exercise.
The brands have been taken over by textile and apparel major Arvind Ltd’s wholly owned subsidiary Arvind Lifestyle Brands Ltd.
Ramesh Tainwala, chairman, Planet Retail Holdings Pvt Ltd, told DNA Money, “I have just concluded the deal and have transferred all the rights in favour of Arvind Lifestyle Brands.”
He, however, did not share financial details. Industry experts said that the transaction value would not be very large as Planet Retail was not the owner of these brands but a franchisee for India.
“It would be difficult to put a value to the size of a deal of that nature,” said a retail consultant.
As part of the deal, Arvind will absorb all the 300-400 employees associated with the Indian operations of the three brands, Tainwala said.
Arvind Lifestyle Brands, which runs value retail chain Megamart, owns 50% stake in Tommy Hilfiger’s India unit. Its existing portfolio of international fashion apparel brands includes Gant, Arrow, US Polo, Elle and Flying Machine. Tainwala said they were looking for a strategic buyer who had expertise in both manufacturing as well as retailing of fashion brands.
“Our business model was based on 100% imports, which was a key concern for viability of the operations. This hurdle gets mitigated now as Arvind has its own manufacturing base and they can do a better job of retailing,” he said.
Arvind Singhal, chairman, Technopak Advisors Pvt Ltd, said international brands need retailing expertise and financial investments to get traction in the Indian market. “The Debenhams departmental chain, Nautica and Next are very good brands and I think the new partners will do a great job based by leveraging on their expertise,” he said.
Earlier, Planet Retail has given up rights on US fashion brand Guess to Major Brands, which markets Mango and Aldo in India.
Experts said Planet Retail had failed to make a mark for the brands brought in to the Indian market in 2007-08 mainly due to positioning and slowdown.
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