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V.F. to spin off jeans business; Japan's Don Quijote keen to buy Walmart's Seiyu

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V.F. to spin off jeans business; Japan's Don Quijote keen to buy Walmart's Seiyu

TOP NEWS

* Apparel maker V.F. Corp., owner of brands such as The North Face and Timberland, announced a plan to split into two independent publicly traded companies in a bid to sharpen its focus in a rapidly changing consumer environment. In a statement, V.F. said it will create a new company containing its outlet business and jeans brands that include labels such as Lee and Wrangler, while the company will retain its apparel and footwear businesses, which include brands Icebreaker and Vans. The new company, which is yet to be named, will be created through a tax-free spinoff to V.F. shareholders expected to be complete in the first half of 2019, subject to board and regulatory approvals and tax and legal considerations.

* Don Quijote Holdings Co. Ltd. will be "interested" in buying Walmart Inc.'s Japanese supermarket unit, Seiyu, if the U.S. retail giant puts it up for sale at "attractive" terms, Reuters reported, citing Don Quijote CEO Koji Ohara. The news comes after Walmart refuted media reports that it plans to offload Seiyu, adding that the company is not in any discussions with prospective buyers as it continues to build its business in Japan. For the fiscal year ended June 30, the Japanese discount store operator posted net income per share of ¥230.14, an increase from ¥209.18 in the year-ago period and above the S&P Global Market Intelligence consensus GAAP EPS estimate of ¥217.45. Net sales rose 13.6% year over year to ¥941.51 billion from ¥828.80 billion in 2017.

TEXTILES, APPAREL AND LUXURY GOODS

* Two former employees of Nike Inc. have sued the company over allegations that it discriminated against women with respect to pay and career advancement, Bloomberg News reported, citing documents filed in the federal court in Portland, Ore. According to the report, the lawsuit accused Nike of violating the Federal Equal Pay Act and similar state laws, as well as claiming that women were "devalued and demeaned" at the company and that their complaints were ignored. A Nike spokesperson told S&P Global Market Intelligence that the company opposes discrimination of any type, has a long-standing commitment to diversity and inclusion, and is committed to competitive pay and benefits for its employees.

* Li Ning Company Ltd. posted a rise in profit for the first fiscal half of 2018 driven by improved operational efficiency. For the six months ended June, the retailer of sporting goods reported that net profit attributable to equity holders jumped 42% year over year to 269 million Chinese yuan, above the S&P Global Market Intelligence consensus GAAP estimate of 265 million yuan. Meanwhile, revenue increased by about 17.9% to 4.71 billion yuan, higher than the 4.59 billion yuan consensus of analysts' estimate compiled by S&P Global Market Intelligence.

MULTILINE

* BHS Group Ltd. pension scheme, called BHS2, which covers £800 million of liabilities, was secured via an insurance buyout by Pension Insurance Corp. PLC, Reuters reported, citing a statement from the specialist insurer. Under the buyout, the responsibility of paying pension fund members will be shifted from the fund to the insurer, which will give policyholders a guaranteed stream of income, the report said. As a result, the 9,000 employees of the collapsed department store chain reportedly are fully insured and will receive benefits under the BHS2 scheme.

* U.K.'s Pensions Regulator will monitor House of Fraser Group Ltd.'s situation "very closely" to check if the department store chain "has attempted to avoid its obligations to a pension scheme," the Financial Times reported. House of Fraser was bought by Sports Direct less than three hours after falling into administration, resulting to retirement liabilities being moved to the Pension Protection Fund, or PPF, which protects members if their pension fund becomes insolvent. The report also said the 5,000 pensioners under House of Fraser may end up with reduced income in retirement since the British statutory fund usually pays out less than a company pension.

E-COMMERCE

* U.K. Chancellor Philip Hammond is considering introducing a special retail tax on online retailers, in a bid to ensure fair taxation between offline and online businesses in the country, the government official told Sky News. Hammond said introducing an "Amazon tax" would entail renegotiating international tax treaties since most big online businesses are global firms, adding that he is looking into "temporary tax measures to rebalance the playing field" until such agreements are in place.

* German meal-kit provider HelloFresh SE lifted its revenue target for full-year 2018 to a growth of between 32% to 37% from a previous outlook of 30% to 35% after posting strong second-quarter results. For the three months ended June, HelloFresh reported that revenue went up 38.9% year over year, or 48% in constant currency, to €319.7 million from €230.1 million in the year-ago period, prompting the company to further invest in sustainable business expansion. HelloFresh also said that it now expects to achieve AEBITDA breakeven on a group level, excluding Green Chef, during 2019 from its previous forecast of achieving AEBITDA breakeven in the fourth quarter of 2018.

* The U.K.'s Advertising Standards Authority, or ASA, will announce a ruling in the week commencing Aug. 13 ordering Amazon.com Inc. to remove claims of "unlimited one-day delivery," deeming it to be "misleading," The Times reported. After a six-month probe into more than 200 customer complaints, the ASA reportedly will require Amazon to clarify that some items on its Prime service are not available for next-day delivery and to remove the claims from its website and on other advertisements.

* Ctrip.com International Ltd. has removed its website's option to let customers pay using Turkish lira, Reuters reported, citing a company spokeswoman. The spokeswoman reportedly said some customers have been exploiting the slump in the currency by paying in lira and asking for refunds in Chinese yuan.

HYPERMARKETS AND SUPERCENTERS

* Australian conglomerate Wesfarmers Ltd. agreed to sell Kmart Tyre & Auto Service to German auto parts giant Continental AG for A$350 million, the latest in a string of recent restructuring moves by the owner of Coles supermarket chain. Upon closing of the deal, expected to be completed in the quarter ending September 2019, Wesfarmers estimates a pretax profit from the sale of the tire and automotive service chain of about A$270 million to A$275 million, subject to adjustments.

HOUSEHOLD DURABLES AND SPECIALTY RETAIL

* Newell Brands Inc. will sell hair accessories business Goody Products Inc. to a fund managed by private equity investment firm ACON Investments LLC. The deal is expected to close within approximately 30 days, subject to customary closing conditions, including regulatory approval. Although terms of the deal were not disclosed, the Sharpie pens maker that Goody's 2017 net sales came in at about $115 million. New Jersey-based Newell revealed in January that it would explore strategic options for some of its brands, including Waddington and Goody, in a series of moves expected to reduce the company's customer base by 50%, among other outcomes.

* Suning.com Co. Ltd. plans to roll out 12,000 franchise stores called "Retail Cloud" in small towns across China by 2020 that will leverage the Chinese electronics retailer's centralized inventory management and sharing. Differing from the traditional procurement business model, Suning expects the format to improve the operational efficiency, merchandise selection, supply chain management and technology capabilities of stores located in rural areas of China. The company plans to have 8,000 such stores by 2019 with an aggregate sales scale of 30 billion yuan.

HOTELS, CASINOS AND GAMING

* Hilton Grand Vacations Inc. has started a nationwide search for a new CFO after it fired executive vice president and CFO James Mikolaichik because of conduct and behavior that were not consistent with the company's policies. The termination, effective immediately, was not related to any "issues involving the company's business, strategy, operations, performance, financial reporting or internal controls." "I'm confident in the quality and depth of talent in our finance and accounting teams and our experienced Chief Accounting Officer Allen Klingsick," Hilton Grand Vacations President and CEO Mark Wang said.

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The day ahead

Early morning futures indicators pointed to a lower opening for the U.S. market.

In Asia, the Hang Seng was down 1.52% to 27,936.57. The Nikkei 225 retreated 1.98% to 21,857.43.

In Europe, as of midday, the FTSE fell 0.51% to 7,628.81, and the Euronext 100 slipped 0.43% to 1,057.93.

On the macro front

No notable reports are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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