Finance

Shares in Gap Inc. skyrocket after deal announced with Kanye West

by Charlie Smith on June 26th, 2020 at 10:29 AM
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      The pandemic has been brutal on Gap Inc., owner of the Old Navy, Banana Republic, and Gap stores.

      Stores were shut down around the world and even today, as they're open, staff are wearing masks and there are limits on the number of customers.

      But today, the San Francisco–based retailing giant shared some good news.

      "Kanye West, a multi-industry creative entrepreneur, is poised to disrupt retail by bringing his YEEZY brand to millions of customers around the world through a partnership announced today with the iconic and globally recognized Gap brand," the company stated. "The YEEZY Gap line is expected to appear in Gap stores and Gap.com in 2021."

      That sent the company's share price shooting upward.

      As of this writing, Gap Inc. is trading at US$12.73 on the New York Stock Exchange, up 25.2 percent from today's opening price.

      “We are excited to welcome Kanye back to the Gap family as a creative visionary, building on the aesthetic and success of his YEEZY brand and together defining a next-level retail partnership,” Mark Breitbard, global head of Gap Brand, said in a company news release.

      West will retain ownership of his YEEZY brand, which was valued at US$2.9 billion in April. Nigerian-British designer Mowalola Ogunlesis is slated to be the design director on the collaboration.

      "Under West’s creative direction, the YEEZY design studio will develop the new line to deliver modern, elevated basics for men, women and kids at accessible price points, with the creative process just getting underway," Gap Inc. stated. "Additionally, West’s design vision will extend to unique YEEZY Gap expressions in Gap stores and digital channels over time."

      In April, Gap Inc. announced that it had suspended rent payments to landlords where stores had been closed due to orders from public-health officials or governments.

      On April 2, the share price fell to US$5.26. Since then, it's risen 142 percent.

      Update

      Gap Inc. shares closed today up 18.8 percent to close at US$12.07 on the New York Stock Exchange.

      This big gain was accomplished on a day when the Dow Jones Industrial Average fell 730.05 points.

      Shares in Gap Inc. were up 18.8 percent on a day when the Dow Jones Industrial Average fell 2.84 percent.

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