NEW YORK — VF Corp. said Monday it has taken a majority stake with Paragon, the parent company of Promociones Lee, the licensee of the Lee brand in Mexico, to form a venture in Mexico.
The new company, Grupo Lee de Mexico, will manufacture and market Lee products primarily for the Mexican market. Lee Apparel is a division of VF Corp.
Timothy Lambeth, president of Lee, said the company is moving forward in spite of the economic volatility in Mexico. “We have been working on this for the past six months, and we think there is a tremendous marketing opportunity,” said Lambeth. “While there may be some bumps in the road, we still have a lot of confidence, and that is why we proceeded.”
Lee has been doing business in Mexico with Paragon since 1989. Lambeth said overall volume has been less than $50 million, but he expects it could double within three to five years. He pointed out that much of the opportunity will be in women’s business, which has not been developed in Mexico. South of the border, the Lee brand has primarily been known as a men’s brand.
Lambeth said that through a majority-owned venture, Lee will be realizing the sales directly, as opposed to realizing the licensing income.