Ashok Piramal acquires Italian shirt brand Men''s Club
12 July 2007Mumbai: The Ashok Piramal Group-owned Morarjee Textiles Ltd recently acquired a 67-per cent controlling-stake for an undisclosed sum in Men''s Club, an Italian brand of shirts.
The Rs213-crore company is looking for another acquisition for its front-end business in Europe, but is yet to zero in on a prospect. The company prefers to acquire a brand offering high value-added products that fits well with the company''s strategy. It also hopes to make a dent in the Japanese and European markets through this acquisition.
Targeting a turnover of Rs27 crore for Men''s Club for the year ending March 2008, the manufacturing has been outsourced to a plant in Southern Italy, and the company plans to let Men''s Club maintain a relative independence in order for the the brand to retain its authenticity.
The group has a design centre at Milan, and has plans for foray into the US market sometime in the next two years. The company supplies fabric and shirts to various international brands such as Flex, Polo Ralph Lauren, Paul Smith, and domestic ones including Zodiac, Allen Solly and Louis Philippe. It also supplies to women''s apparel brands such as Marks & Spencer and Zara. It will start supplying trousers next year.
In the second-phase of expansion, the company will look to acquire 10-12 acres of land in either Tumkur district of Karnataka or in Visakhapatnam, which will entail an investment of around Rs50-60 crore. Capacity expansion will double to 25 lakh pieces of fabric per annum. The plant would also support the company''s garment unit based in Bangalore, Integra Apparels, which makes medium to premium brands, and exports both menswear and womens wear to Europe, Australia and the US.
company will undertake an investment of Rs150 crore over the next year in its
expansion to build synergies between its fabric, garment and brand divisions.
Funding will come from internal accruals, debt and the 50 remaining warrants of
the company''s rights issue.