The intention to spin-off and list Global Brands Group as a separate publicly-listed entity was announced on 20 March 2014 at the same time the company laid out a new three-year plan. The company has since been segregating its brand licensing and management operations to spin off as the new standalone Global Brands Group.
“This is a very exciting milestone for all of us at Li & Fung and Global Brands Group. In 2005, we began the brands and licensing business to capitalize on Li & Fung’s expertise, global network, and history in the apparel industry. It has since grown into a very sizable and renowned business that manages a portfolio of some of the strongest global brands that exist today.
Given the separate needs and different business models of Li & Fung and Global Brands Group, creating two companies will enable the management of each to pursue their own specific and focused strategy. Li & Fung will be able to concentrate on its sourcing and logistics focus, which requires sourcing skills and product development and supply chain management for retailers and brands globally. On the other hand, Global Brands Group requires fashion-forward design capabilities as well as brand development, licensing, and marketing skills.
The leadership teams of both businesses will be very strong. For Global Brands Group, Bruce Rockowitz will assume the role of Chief Executive Officer and a very strong management team has been put in place, the majority of whom have been involved in the running of the brands and licensing business at Li & Fung. Dow Famulak will become President and manage business operations, Ron Ventricelli will be the Chief Operating Officer, Jason Rabin will become the Chief Merchandising Manager, and Frank Leong will join as Chief Financial Officer. William Fung will become the non-Executive Chairman.
At Li & Fung, as previously announced, William Fung will remain Chairman and Spencer Fung, currently Chief Operating Officer, will assume the role of Chief Executive Officer. Spencer has worked in the business for 13 years in different locations around the world. There are currently no other changes in the Li & Fung management team.
For Global Brands Group, an uninterrupted focus on the brands business will allow its management team to fully build out the business and leverage a new dedicated capital structure able to fund its further growth and development.
Global Brands Group designs, sources, imports and sells apparel, footwear and fashion accessories primarily for retailers.
It owns licenses to more than 350 brands and effectively owns another 150 either outright or through long-term licenseing agreements that give them complete control over design, distribution and brand management. It earns 85 percent of its revenue from the United States where its major customers include Walmart Stores Inc., Target, Nordstrom, Macy’s, Koh’ls and J.C. Penney. It’s brand portfolio does include licenses to make some products under the Ocean Pacific, Quiksilver and Under Armour brands.
In August, 2013 it entered a 38-year global licensing agreement In August, 2013 with Spyder Active Sports Inc., which is owned by Authentic Brands Group LLC that made Global Brand exclusive licensee partner in North, South and Central America, Europe, the Middle East and Africa for all footwear (excluding ski and snowboard boots), sportswear and clothing accessory products bearing the Spyder name. Global Brands has said it thinks it can extend the ski apparel brand into other categories. It is currently in the process of launching an e-commerce platform for its Frye and Spyder brands.
“All of us at Li & Fung see great opportunity to develop this business further through a growth strategy that will include further building out the portfolio of licensed brands, adding new categories to the current brand portfolio, and increasing the geographic and channel footprint,” Rokowitz continued. “We believe that allowing Global Brands Group to focus on this strategy as a standalone business will be the best way forward.”
Global Brands Group designs, sources, imports and sells apparel, footwear and fashion accessories primarily for retailers. It owns licenses to more than 350 brands and effectively owns another 150 either outright or through long-term licenseing agreements that give them complete control over design, distribution and brand management. It earns 85 percent of its revenue from the United States where its major customers include Walmart Stores Inc., Target, Nordstrom, Macy’s, Koh’ls and J.C. Penney. It’s brand portfolio does include licenses to make some products under the Ocean Pacific, Quiksilver and Under Armour brands.
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