Victoria’s Secret forms joint venture for China business with Regina Miracle
Victoria’s Secret has teamed up with lingerie manufacturer Regina Miracle on a joint venture relating to its existing business in China.
Under the terms of the agreement, Victoria’s Secret owns a 51% stake and Regina Miracle the remaining 49%.
Martin Waters, Victoria’s Secret chief executive, said he was confident that the partnership will accelerate the company’s growth opportunities in the country.
He added: “This collaboration was an important step for Victoria’s Secret and completes the reformatting of our international business to be exclusively a franchise or partner-based model, and supports both online and store growth at a faster pace and more profitably. We believe our business is underpenetrated internationally and double-digit sales and profit growth is a realistic opportunity, both in the near-term and over a long-term time horizon.”
Victoria’s Secret received $45 million in cash from Regina Miracle as consideration for its investment in the joint venture.
YY Hung, chairman and chief executive of Regina Miracle, said, “The successful closing of the joint venture agreement between Regina Miracle and Victoria’s Secret marks an important milestone in our long-standing partnership. Through the formation of this partnership, we are pairing Regina Miracle’s innovation capabilities and market foresights as an innovative design manufacturer with Victoria’s Secret’s undisputed innovation and brand leadership, retailing and marketing expertise.”
Victoria’s Secret said it does not expect the transaction to have a material impact on its sales, operating income and earnings per share guidance for the first quarter of fiscal 2022.
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