Indian Rayon buys Louis Philippe, Van Heusen and Allen Solly brands
India Today
Mumbai, December 21: Aditya Birla group's Indian Rayon and Industries Ltd today announced acquisition of Madura Garments, readymade garments division of Madura Coats Ltd, including rights for its premium brands in SAARC and Middle East regions for a total consideration of Rs 236.23 crores.
The acquisition of Madura Garments and international brands such as Louis Philippe, Van Heusen, Allen Solly, Byford, Peter England and Sanfrisco would catapult the Indian Rayon group as India's largest branded apparel company.
Indian Rayon will acquire Madura Garments from Madura Coats, a subsidiary of Coats Viyella Plc, UK, together with all the employees, brand licenses, distribution and manufacturing networks for a consideration of Rs 189.23 crores and will become the owner/licensee for India for the premium brands.
In a separate transaction, Aditya Vikram Global Trading House Ltd, a wholly owned overseas subsidiary of Indian Rayon, will purchase from Coats Viyella the technology and exclusive brand rights for various countries in SAARC and Midle East regions for US Dollar 10.8 million (Rs 47 crores).
Madura Garments, which will be formally transferred to Indian Rayon from January 1, 2000, had annual sales of about Rs 250 crores in 1999 and has enjoyed a robust sales growth of over 40 per cent in the last five years.
Aditya Birla group Chairman Kumar Mangalam Birla said, "There will be no change in Madura Garments' operations on account of change in ownership and we will only further facilitate its growth by adding value through critical inputs of capital and leadership."
DSP Merrill Lynch acted as the investment banker to Indian Rayon for the acquisition, while Ernst & Young carried out the due diligence.
Indian rayon plans to finance the acquisition primary through its current cash surplus and internal accruals. "In view of the growth opportunities and current low interest rate scenario, we may consider raising market borrowings to augment internal resources," the company's Chief Financial Officer Adesh Gupta said.
This is the fifth acquisition by the group in the last two years, followed by two in the cement industry, one in the pulp industry and the takeover of US-based LearningBytes International. |
