Motley Fool Income Investor pick VF (NYSE:VFC), whose name results from its longtime association with the Vanity Fair brand of intimate apparel, is now selling off that part of its business. The company, which was founded in 1899 and is headquartered in Greensboro, N.C., announced Tuesday that it will unload this and related relatively lower-margin businesses to a unit of Berkshire Hathaway (NYSE:BRK-A) for $350 million in cash.

Born as Vanity Fair Silk Mills, the company today is also involved in the manufacturing and marketing of jeanswear, "imagewear" (work-related apparel, such as uniforms), outdoor apparel, and sportswear. Of its anticipated 2006 total revenues of just more than $7 billion, the businesses being sold represent about $800 million, or nearly 12% of the total. However, their contribution to operating profit is expected to be closer to 6%. In addition to Vanity Fair, the brands involved in the sale include Vassarette, Bestform, and Lily of France.

VF's jeanswear unit operates through such well-known brands as Wrangler, Lee, and Riders. It imagewear brands include Red Kap and Bulwark, its outdoor apparel includes North Face and JanSport, and its sportswear includes the Nautica brand.

In a conference call related to the sale, VF CEO Mackey McDonald noted, "While the intimates team has a well-designed plan to improve margins, we believe the investments required to get there would be better deployed toward the growth opportunities in our jeanswear, outdoor, and sportswear businesses." He also said that "while we will continue to pursue acquisitions aggressively, we expect the majority of our growth will come from exploiting opportunities in our existing businesses."

McDonald predicted that the sale would cost VF about $45 million for 2006 and would result in a lowering of per-share earnings guidance for the year, from the previous $5.05 to a new range of $4.70 to $4.72. Further, projections for 2007 revenue growth now appear to translate to earnings per share of about $5.20 for the company, or about 6% below the $5.55 that analysts apparently had been anticipating.

My take on the sale is that, once the short-term negative effects on the company's finances have faded, it likely will be positive for VF, in that it will permit the company's management to concentrate its efforts on its array of well-known and more profitable brands in other areas. VF operates in a highly competitive area; it goes head-to-head with such companies as Hanesbrands (NYSE:HBI), Warnaco Group (NASDAQ:WRNC), American Eagle Outfitters (NASDAQ:AEOS), privately held Levi Strauss, and, to a somewhat lesser extent, Jones Apparel Group (NYSE:JNY).

And so what looks like a solid move for VF also must stand the test of time. In the meantime, Foolish investors probably should hold onto their wallets -- and avert their gazes -- while the company sheds its intimate-apparel connection and moves to strengthen its other solid brands.

For additional Foolishness:

VF is a Motley Fool Income Investor recommendation. To see what other great dividend-paying companies we've selected, take a free 30-day trial to the service today.

American Eagle Outfitters is a Stock Advisor selection, and Berkshire Hathaway is an Inside Value pick.

Fool contributor David Lee Smith has been known to don several of VF's brands, although not all at once. He does not own shares in any company mentioned, and he welcomes your questions and comments. The Fool's disclosure policy sees London, it sees France ...