Gap has dropped plans to spin off its Old Navy banner into a separate publicly-traded company, the retailer said, citing the expense and other difficulties that would be involved. Sales at Old Navy have softened since Gap first proposed the spinoff last year.
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Gap has named Old Navy Finance Chief Katrina O'Connell as its new chief financial officer, appointed Athleta CEO Nancy Green to lead Old Navy and chosen Banana Republic President and CEO Mark Breitbard to head Gap Asia and other specialty brands. The news came as Gap reported better-than-forecast quarterly sales and earnings, fueled largely by a resurgence at Old Navy.
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Gap's planned spinoff of Old Navy has the potential to raise cash the company needs to paid down debt and focus on growing its other brands. Analysts offer mixed views on whether it's the right time to separate Gap's most successful brand from the pack.