Arvind Fashions to sell Unlimited retail biz to V-Mart Retail; stock up 16%

Shares of Arvind Fashion moved larger by 16 per cent to Rs 196.65 on the BSE within the intra-day commerce on Thursday after the nation’s main casual and denim clothes producer introduced a divestment of the property of ‘Unlimited’ business to V-Mart Retail in an all money transaction for about Rs 150 crore. The company stated it had determined to exit this business and to concentrate on rising the high-conviction focus manufacturers.

“Arvind Lifestyle Brands Limited (ALBL), a wholly-owned subsidiary of Arvind Fashions Limited (AFL), has signed definitive agreements for strategic sale of property of its Unlimited retail business to V-Mart Retail Ltd. in an all money transaction,” Arvind Fashions stated in a media launch.

As a part of the transaction, ALBL will sell property consisting of mounted property, lease deposits and recognized stock and different present property of the 74 retail shops and the warehouse to V-Mart at its guide worth.

As per the deal, ALBL would obtain money consideration estimated at about Rs 150 crore upon the closure of transaction and thus, will totally recuperate the capital employed within the business. In addition, there are contingent funds to be acquired, primarily based on sure milestones achieved by V-Mart over subsequent few years for these shops, put up the acquisition. The Company intends to utilise the quantity so acquired for compensation of debt and for working capital functions.

“This sale will help AFL achieve its objective of focusing on its 6 high conviction brands which include US Polo Assn., Tommy Hilfiger, Arrow, Flying Machine, Calvin Klein and Sephora. This also significantly completes the process of reset that AFL had embarked on, to consolidate and sharpen its portfolio as well as to strengthen its balance sheet,” it stated.

The completion of transaction is topic to obligatory approvals and customary closing circumstances.

Meanwhile, shares of V-Mart Retail traded 2 per cent larger at Rs 3,304, after hitting a intra-day excessive of Rs 3,319 on the BSE.

Dear Reader,

Business Standard has at all times strived laborious to present up-to-date data and commentary on developments which can be of curiosity to you and have wider political and financial implications for the nation and the world. Your encouragement and fixed suggestions on how to enhance our providing have solely made our resolve and dedication to these beliefs stronger. Even throughout these troublesome instances arising out of Covid-19, we proceed to stay dedicated to maintaining you knowledgeable and up to date with credible information, authoritative views and incisive commentary on topical problems with relevance.
We, nonetheless, have a request.

As we battle the financial influence of the pandemic, we want your assist much more, in order that we are able to proceed to give you extra high quality content material. Our subscription mannequin has seen an encouraging response from lots of you, who’ve subscribed to our on-line content material. More subscription to our on-line content material can solely assist us obtain the objectives of providing you even higher and extra related content material. We consider in free, truthful and credible journalism. Your assist by extra subscriptions might help us practise the journalism to which we’re dedicated.

Support high quality journalism and subscribe to Business Standard.

Digital Editor

Back to top button