Arvind Mills, one of the largest integrated denim manufacturers of the world, is planning a major retail push in the branded apparel retailing segment in India and abroad.
The company has decided to buy the 53.4 per cent stake held by ICICI Venture Fund in Arvind Brands Ltd for Rs 106 crore (Rs 1.06 billion).
The denim major will also issue global depository receipts (GDR) for 14 million shares amounting up to $30-40 million, which is equivalent to about 7 per cent of the expanded equity base of the company.
Major part of the GDR issue will be used for the retail initiatives in branded apparel market.
"We would focus on branded apparel retailing, which is one of the fastest growing segment. The acquisition of Arvind Brands would allow the parent company to leverage its expertise in fabric manufacturing," Sanjay Lalbhai, managing director, Arvind Mills told Business Standard on Wednesday.
"In the international market, we would like to take our brands to Bangladesh, Sri Lanka, African and European countries apart from the US market."
Through the acquisition of Arvind Brands, Arvind Mills plans to open exclusive company owned retail outlets for the brands such as New Port, Flying Machine, Ruff and Tuff, amongst others. The company is also the Indian licensee for international brands such as Arrow, Lee, Wrangler and Tommy Hilfiger.
The company had recently acquired the American rights of Italian designer denim brand, Reds and signed an agreement with the company promoted by designer Stephano Turk to acquire the brand rights in the US markets.
Reds is a casualwear brand with a heavy accent on denim pants and will retail in the US stores at $180 onwards.
"We have initially launched the Reds brand in the US markets in a small scale and plan to enhance the brand presence. Our aim is to get the brand to the top 30 retail stores in the US, and position it to the right audience," said Lalbhai.
Arvind Brands Ltd is the licensee for marketing Arrow brand in India, Saarc and Milldle East countries.
The company is already in process of the revamping Arrow stores across the country and plans to add around eight more stores in Middle East with investment of around Rs 10 crore (Rs 100 million).
