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Integral to buy Japanese clothing major Itokin
12
Feb '16
Japanese investment fund Integral will acquire apparel company Itokin for an estimated 16.5 billion yen ($144 million) to lead its turnaround efforts, the Nikkei Asian Review has reported.

Itokin's decision to get help from Integral in its rehabilitation efforts came as the company faced the prospect of imminent insolvency

Integral will obtain new shares in Itokin via private placement for some 4.5 billion yen to gain 98 per cent of voting rights. The fund plans to occupy more than half of the seats on the board, including the chairman.

Established in 1950, Itokin is Japan's fifth-largest women's apparel company. The unlisted Osaka company offers such brands as Michel Klein and Elle. Slow to shed money-losing brands, the company had suffered losses for four straight years through January 2015.

Integral will reduce brands to around 20 from the current 28, and consolidate stores to about 1,000 from 1,400. At the same time, it will promote mainstay brands such as Hiroko Koshino through store renovations. By pouring resources into e-commerce as well, Integral hopes to make the company profitable in the year ending in January 2017. The fund plans to raise the corporate value over three to five years, with possible plans to list it on the stock market.

With the rise of specialty retailers of private-label brands such as Fast Retailing, known for its Uniqlo brand, traditional apparel companies like Itokin have struggled. Department stores, the main sales channel, have seen substantial declines in apparel sales over the past five years. (SH)

Fibre2Fashion News Desk – India

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