Sources inform “Globes” that Clal Industries and Investments (TASE: CII), the Israeli representative Levi Strauss & Co., will cease marketing Levis brand jeans, after 15 years of joint activity. Levi's sales have weakened greatly in Israel and worldwide in recent years.
The sources added that Clal Industries will fire most employees of Levis franchisee Tango Ltd., and merge it with Kitan Industries. The Levis franchise is expected to go to Al Srad Ltd., owned by the Irani family, which imports Diesel jeans.
The contract with Clal Industries will terminate in May 2005, over disagreements between Tango and Levi Strauss & Co. Two months ago, Levi Strauss's regional headquarters in Turkey notified the management in Israel that it wanted to change its strategic plan, and instructed Tango to remove Levis from all fashion retail chains in Israel, including New Hamashbir Lazarchan, H&O (Hamashbir Fashion) (TASE: MSBR), and Golf. Levi Strauss & Co. also forbade Tango from independently buying samples, or developing original designs based on Levis.
Al Srad is expected to market Levis according to the new guidelines, in a limited number of stores, including its retail network which includes a brand name super-store in Netanya.
Published by Globes [online], Israel business news - www.globes.co.il - on March 3, 2005