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Gap Stores (NYSE: GPS), the parent company of Gap, Banana Republic and Old Navy, has been threatening to revitalize its U.S. stores for years. But with the stock down more than 50% since the dawn of the new millennium, the company has failed to restore its brands to relevance.Now the company has announced that it will partner with Fiba Holdings A.S. to pen Gap and Banana Republic stores in Russia. Fiba will act as the franchise partner, just as it does for the company's stores in Turkey. Stores will be begin opening in time for the holidays.
Its possible that Gap will be able to regain some strength by focusing on international opportunities. Domestically, it's hard to think of a more passé fashion brand. But just as American baseball players on the decline often head to Japan and find success, once-iconic American fashion brands sometimes find new life overseas. Apax Partners' success with the Tommy Hilfiger brand is a prime example.
For now, though, I think investors should stay away from shares of Gap.
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