Mexico's GFM Textiles (GFMT) and Italy's Calitri Denim Industry (CDI) have set up a joint venture to enhance the global coverage of both companies.

The new company, GFMT Italy, is 80% owned by GFMT and 20% by CDI. GFMT Italy also has the option of acquiringe all CDI assets through a financial lease within the next 12 months.

Under the deal, the new company will supply fabric designed and produced in Italy and Mexico.

Jose Antonio Rivero, GFM's chairman said the agreement will enhance the company's global coverage, as well as proving customers with an option to source core products globally through a single supplier.

"It represents an entry to the European market by combining the strengths of 15 years' heritage in Italian design, development and quality with over 100 years of Mexican industrial manufacturing experience for the North American market."

He added that GFMT Italy hopes to achieve a substantial increase in its sales volume in the next two years.