Arvind sells 40% stake in VF Arvind Brands to partner

Moneycontrol Bureau

Apparel maker Arvind has sold its 40% stake in joint venture VF Arvind Brands to partner VF Mauritius for Rs 257 crore and will use the proceeds to reduce debt. The VF Arvind Brands joint venture was formed by the two companies in September 2006 for marketing products under Lee and Wrangler brands and Arvind had invested Rs 5.47 crore in capital of the JV. The divestment was done in terms of the joint venture agreement, in which VF had right to acquire shares from Arvind at end of five years, the company said Wednesday. "In the last financial year, our share of revenue of the JV was approximately Rs 120 crore, which constituted slightly less than 3% of our consolidated revenue. Arvind plans to utilise cash flow received from sale of the JV in reducing its debt," said CFO Jayesh Shah. Arvind shares ended down 0.4% at Rs 106.50 on NSE on Wednesday.