Tata-owned retail firm Titan Company is scaling down operations of its wholly-owned subsidiaryFavre LeubaAG (FLAG) with immediate effect. Covid-19 led disruption has severely disrupted the revival plans and prospects of the Swiss watch brand in the country, the company said in a regulatory filing.
Titan which sells watches, jewellery and eyewear, had made a series of investments amounting about Rs 275 crore, over eight years for the revival of the Favre Leuba brand. Incorporated in 2012 by Titan, Favre Leuba is one the oldest watch brands in the world.
“The Board of Titan at its meeting held today has decided to request the FLAG management to scale down the operations of the company substantially with immediate effect so that further investments from Titan to FLAG cease as early as possible,” the company stated in a the filing. “Consequently, this will lead to Titan making provisions in the current financial year for additional impairment pertaining to its investments in FLAG, in addition to the impairment of Rs 145 crore already made in earlier years,” it added.
In October, Titan had ended its five-year old joint venture partnership with luxury pen and watch maker Mont Blanc by mutual agreement driven by the company’s consolidation strategy to focus on their primary business and proprietary brands amid the pandemic. In accordance with the joint venture agreement, the partnership with Mont Blanc will end in December.
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