Branson Launching Virgin Clothing

After putting his Virgin brand name on everything from jumbo jets to cola cans, tycoon Richard Branson is about to see how well it fits on a new line of sportswear.

Branson may be off to a bumpy start as he launches the first autumn-winter collection of Virgin Clothing on Thursday.

The debut of the upscale fashion line comes amid severe turbulence at Virgin's clothing and cosmetics subsidiary, Victory Corp. PLC, which saw its shares nosedive early this week following a profit warning and a boardroom shakeup.

And at least one prominent critic wonders whether Virgin is aiming a little too high in the market.

"It's in step with what's happening in fashion," said Mimi Spencer, fashion editor at London's Evening Standard newspaper. "But it may be out of step with what one perceives is happening with the Virgin brands."

Many shoppers identify the Virgin brand name with rock music and cola, but the Virgin Clothing line is targeting a more affluent audience than the youngish customers who are likely to buy those Virgin products, Spencer said.

The Virgin clothes are "altogether better than we anticipated, and more expensive, and that may be a problem," she said.

Virgin spokesman Will Whitehorn took issue with Spencer's characterization of Virgin brands as "young, fun and frivolous."

Whitehorn pointed to Branson's successful international airline, Virgin Atlantic Airways, and the Virgin Direct financial services business. "You tell me that Virgin Atlantic is a young and frivolous airline," he said.

It has not been an easy week for Victory Corp.

Founders Rory and Tim McCarthy stepped down as directors Monday to make room for managers appointed by Virgin after it recently took control of the company.

The vast bulk of Branson's Virgin empire is privately held and immune to the daily ups and downs of the stock market, but Victory Corp. is listed on London's small-issue stock exchange, the Alternative Investment Market.

After a long price slide, Victory lost half of its remaining value on Monday, slipping to 9.5 pence (15 cents) per share. The shares crawled back to 11 pence by late Wednesday - little consolation for investors who bought in nearly two years ago at 58 pence.

Whitehorn suggested the previous directors had acted too hastily in putting their company on the market before it had established its business. With Virgin in control, the business outlook is better, he said.

The Virgin Clothing line will be launched Thursday at London's fabled Selfridge's department store, then rolled out to 200 more retailers around Britain, he said.

Meanwhile, the cosmetics operation has opened a handful of Virgin Vie stores, including one in London's prime Oxford Street retailing area, while selling its goods through 1,500 more dealers.

Written By Dirk Beveridge