Growing V-Grass gives luxury fashion Chinese style

Nanjing dressmaker V-Grass Fashion Co has an audacious plan to become the Valentino of the Chinese fashion world, and buying a South Korean fast-fashion brand with more than six times as many stores in China is part of its move to get there.

V-Grass agreed this month to acquire the Chinese business of E-Land Group's Teenie Weenie in a deal valued at about $900 million. For V-Grass, which is planning its first overseas store in Milan, the purchase will help support falling sales and profit as the Shanghai-listed retailer shuts a third of its lower-end outlets and restructures to focus on the luxury-minded, according to Tao Weimin, its vice-president.

"We wanted to find a brand to prop up our performance so we can build up what we want to do with the V-Grass label," Tao said in an interview in Nanjing, capital of eastern Jiangsu province. "As a listed company, the market will react badly if we take too long to show profit from the restructuring. This acquisition will let us be bolder."