Celebrity Fashions inks MoU to acquire Ambattur clothings
04 Apr '06
2 min read
Celebrity Fashions has acquired an export oriented unit of the Chennai-based Ambattur Clothings (ACL).
A memorandum of understanding (MoU) has been inked to this effect by which Celebrity Fashions has allotted through private placement 5,00,000 secured redeemable non-convertible debentures of Rs 100 each, carrying an interest of 8.75 percent for ACL having a total issue size worth Rs50 million.
The deal will come into effect from April 01, 2006 as per terms and conditions mentioned in MoU signed in December 2005.
The tenor of the instrument is 11 months and interest is payable on quarterly basis.
ACL unit in Chennai produces six million trousers in two-shifts.
This acquisition, will more than double Celebrity Fashion's existing garment-making capacities.
ACL has large scale operation compared to Celebrity Fashions.
It has a number of international clients supplying to well known retalier brands like Banana Republic and Gap, thereby giving Celebrity Fashions a wider overseas presence.
Celebrity Fashions posted a turnover of Rs 110 crore in 2004-05.
Celebrity Fashions is mainly a garment exporter having a retail presence in India through its brand Indian Terrain.
It supplies garments to brands like Eddie Bauer and Kenzo in the US, and to Diesel, Marlboro Classics and Kenzon in Europe.
The company which had come out with its IPO in December last year, intends to fund this acquisition using part of its proceeds.
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