Kumar Mangalam Birla’s fashion empire raises ₹2,195 crore from Singapore’s sovereign fund

• Aditya Birla Fashion and Retail has raised ₹2,198 crore from GIC in exchange for 7.5% shareholdings.
• GIC will invest ₹770 crore now towards subscription and warrants, followed by up to ₹1,425 crore in one or more tranches.
• The retail company will use this capital to accelerate the growth of its current businesses.

Kumar Mangalam Birla owned Aditya Birla Fashion and Retail (ABFRL) today raised ₹2,198 crore from Singapore’s sovereign wealth fund GIC in exchange for 7.5% stake in the company. The fashion retailer houses a large number of Indian and international brands like Sabyasachi, Forever21, Ralph Lauren and more.

GIC will invest ₹770 crore now towards subscription and warrants, followed by up to ₹1,425 crore in one or more tranches within 18 months upon exercise of warrants. Aditya Birla Group will hold approximately 51.9% stake in the company after this transaction.

“Indian apparel industry is set for robust long-term growth due to strong fundamentals of a large and growing middle class, favourable demographics, rising disposable incomes and aspiration for brands,” said Kumar Mangalam Birla, chairperson of Aditya Birla Group.

The transaction is subject to regulatory and other customary approvals.

A ‘future-ready’ consumer company

GIC believes that the organization is all set to grow with a robust plan to capture the next phase of digital growth. “ABFRL has a strong track record of building brands and its new business lines, including innerwear and ethnic wear, have strong structural tailwinds,” said Choo Yong Cheen, chief investment officer of GIC, calling ABFRL a future-ready consumer company.

The retailer will use this capital to accelerate the growth of its current businesses and other emerging high-growth business models. “This capital infusion will allow us to accelerate the growth of this platform of strong brands and well-established retail formats in the fast-growing branded apparel market and fortify our position as one of the leading players in the industry,” said Ashish Dikshit, managing director of ABFRL.

Aditya Birla Fashion and Retail (ABFRL) is a part of the metals-to-cement conglomerate, The Aditya Birla group. The company clocked in revenues of ₹8,136 crore and has a retail space of 9.2 million square feet. It spans across 3,468 exclusive stores, 6,515 points of sale in department stores and 28,585 multi-brand outlets across India.

It houses some of the largest and most iconic brands in India including Louis Philippe, Van Heusen, Allen Solly and Peter England. The company also formed strategic partnerships with designers like ‘Shantanu & Nikhil’, ‘Tarun Tahiliani’, and ‘House of Masaba’.

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