According to a senior corporate official, Aditya Birla Fashion & Retail (ABFRL) will seek between 700 and 800 crores in debt to aid in financing the purchase of TCNS Clothing.
“For funding, we’ll need to raise between 700 and 800 crore through the issuance of external debt… According to Ashish Dikshit, managing director of ABFRL, “internal accruals will be used to fund the remaining 800 crore.” “We can raise that because of our strong balance sheet.”
ABFRL and TCNS, which owns women’s ethnic wear brands like W, Elleven, and Aurelia, reached an agreement on Friday for ABFRL to purchase a 51% share in TCNS for $1,650 crore.
ABFRL will make a conditional open offer to purchase up to 29% of the company at 503 per share from public shareholders as part of the agreement. the final portion of the initial promoters’ investment to reach a 51% overall stake in TCNS.
Following the acquisition, TCNS and ABFRL will be amalgamated, and TCNS’s public shareholders will each get 11 shares of ABFRL for every six that they currently own of TCNS.While the entire garment business is mostly unorganised, a survey by Antique Stock Broking predicts that the retail share of women’s wear in the branded apparel arena will rise from 31% in FY20 to 35% by FY25.
Additionally, women’s ethnic clothing is a market where international retailers like Zara and H&M are absent, therefore Indian apparel businesses benefit from having a strong presence in this area overall.ABFRL split their company more than five years prior into Lifestyle, Pantaloon, athleisure, young fashion, super premium, and ethnic are the six subcategories. However, the majority of brands concentrate on western-style apparel, a niche that is much smaller than the overall market for women’s ethnic clothing.
