Singapore fund to buy 25.4 per cent in S Kumar's Reid & Taylor for Rs900 crore

The Government of Singapore Investment Corporation (GIC) will buy 25.4 per cent equity stake in Reid & Taylor (India), a wholly-owned subsidiary of S Kumars Nationwide Ltd (SKNL), for Rs900 crore ($209 million).

GIC, which manages funds of over $100 billion globally, will make the acquisition through purchase of new shares and warrants and route the investment through its affiliate, Indivest.

The deal, which will be executed through a mix of fresh shares and convertible warrants, puts the valuation of Reid & Taylor at Rs3,540 crore, higher than SKNL's Rs2,240 crore.

After the conversion of warrants, the Kasliwals-controlled SKNL will hold 74.5 per cent stake in Reid & Taylor, which is in the business of high-profit margin luxury textiles and ready-to-wear garments. Its brands are endorsed by the likes of Amitabh Bachchan and Pierce Brosnan

SKNL, which acquired Dumfriesshire-based Reid & Taylor in 1997, later spun it off into a separate unit and plans to list it later.

SKNL, meanwhile, said it will invest up to Rs2,000 crore in a holding company SKNL International, which will be set up in the Netherlands.

Reid & Taylor plans to open 341 stores by 2010, with a majority of high-street exclusive outlets and the remaining in shopping malls.