In May, the Aditya Birla Group said it will consolidate its garments business into a single entity by carving out a premium apparel maker Madura Garments Lifestyle Retail Co. Ltd from Aditya Birla Nuvo Ltd and merging it with Pantaloons Fashion and Retail India Ltd. The merged entity will be India’s largest branded clothing company with annual sales of Rs.5,290 crore.
The consolidation will unlock shareholder value and give investors an opportunity to invest in the fast-growing fashion space through Aditya Birla Fashion and Retail Ltd, said Kumar Mangalam Birla, chairman of the Aditya Birla Group.
The boards of Aditya Birla Nuvo, Pantaloons Fashion and Madura Garments at their respective meetings held on Sunday approved the consolidation of the branded apparel businesses. The boards have also approved the swap ratio recommended by independent valuers.
Other businesses that will be separated from the respective companies and merged with Pantaloons Fashion are Madura Fashion, a branded apparel retailing division of Aditya Birla Nuvo, and Madura Lifestyle, an apparel retailing division of Madura Garments Lifestyle.
Kumar Mangalam Birla, chairman of Aditya Birla Group, described abof (all about fashion) as an online one-stop fashion portal for apparel, footwear and accessories for men and women.
“The e-commerce sector is a sunrise sector from an investment point of view. While a lot has happened in the last couple of years, a lot more is yet to happen in this space,” Birla said.
He said Aditya Birla Group is already India’s largest fashion company through Madura Fashion and Pantaloons.
“Therefore, it made sense for us to enter into fashion e-commerce to further strengthen our pole position in the business of fashion in India. We see the potential to build another billion dollar business of the group in this space,” Birla said.