Gap plans to separate from the old navy after a catastrophic year



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Gap, one of the largest shopping center operators in the United States, announced on Thursday its intention to turn Old Navy into a separate public company, establishing a dividing line between the family clothing chain and its classic brands. , more expensive.

The distinct company would contain the namesake label of Gap, Banana Republic, Athleta, Intermix and its new brand Hill City. Gap aims to finalize the transaction in 2020 and the two companies will have a similar size. Old Navy generated approximately $ 8 billion in revenue in the last fiscal year, while the brands that make up the new entity total approximately $ 9 billion.

Art Peck, chief executive of Gap, said at a call for results that the proposed split was an opportunity "to write the next chapter for the specialized retail business". He added that over time, Old Navy's needs have differed from those of the rest of the brands. . It shares fewer customers with other labels, has a smaller global footprint, and uses different in-store technologies.

"Old Navy is a little faster, its price is lower," said Greg Portell, senior partner of the consulting firm A. T. Kearney in the consumer and retail sector globally. "If you think of shopping mall brands, they are fundamental, they are classic, they are not so promising. Athleta is a bit different, but it still targets the consumer who is looking for a different experience than the old navy, a price-based go-now buyer. "

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