Eyes will be on OrotonGroup Limited (ASX:ORL) this morning after the accessories brand revealed after the market closed its licence deal with Ralph Lauren will expire in June 2013.
Under the terms of the licence Ralph Lauren will pay Oroton an estimated $30 million for inventory and store assets as the American designer transitions to managing its own presence in Australia.
Chairman Ross Lane says Oroton is disappointed to end the partnership. The Ralph Lauren business represents about 45 per cent of Oroton’s sales, 50 per cent of its assets and 35 per cent of its net profit.
Oroton is now expected to pursue the expansion of its own brand in Asia and other opportunities including capital management.
Shares in Oroton last traded at $7.74, before being placed into a trading halt on Wednesday.
OrotonGroup reported a net profit of $16 million in the first half of the 2012 financial year.