Gap Inc. announced Thursday that it will split into two independent publicly traded companies — one comprised of its Old Navy brand, and the second a yet-to-be-named company that includes its other brands like Banana Republic and Athleta.
Gap said the new company, which it’s currently referring to as “NewCo,” should have roughly $9 billion in annual sales. It will include the namesake Gap brand, Banana Republic, Intermix, and athleisure lines Athleta and Hill City.
“It’s clear that Old Navy’s business model and customers have increasingly diverged from our specialty brands over time, and each company now requires a different strategy to thrive moving forward,” Robert Fisher, Gap’s board chairman, said.
Gap also on Thursday announced it plans to shut 230 of the namesake brand’s locations over the next two years, as it works to restructure its business.