Alok buys 16% in UK retail chain

The Jiwrajka family-controlled Alok group is acquiring 16 per cent stake in British retail firm, Hamserd Group, for Rs 30 crore. The city-based textiles group also reserves option to scale up its stake in Hamserd to another 10 per cent.

Confirming the development, Dilip B Jiwrajka, managing director of the group flagship Alok Industries, said the company would play a role in managing the foreign company that runs two retail chains, QS and Bewise. Hamserd has a network of 354 retail stores in the United Kingdom with sales worth 200 million pounds (nearly Rs 1,600 crore)

"We will send a representative on the Hamserd board. The number of the board members will go up to two if we scale up holding to 26 per cent," said Jiwrajka. He said Grabal Alok Impex, a part of the Alok group, would pick up the stake in the closely held British company. He added the Grabal Alok board took the decision to invest in Hamserd this evening. Jiwrajka is also on the board of Grabal Alok.

Explaining the rationale for picking up stake in the foreign retail chain, Jiwrajka said the move would provide great sourcing opportunity to the group. "Alok Industries and Grabal Alok export products mainly to the UK and the US. A bondage with a retail chain will help us sell products," he said.

The group might explore similar opportunities at home in future, he added. The Grabal Alok stock closed at Rs 106.30, nearly 5 per cent higher than yesterday's closing, on the Bombay Stock Exchange.

Grabal Alok is into high-value added embroidered fabrics business. It has posted a net profit of Rs 2.37 crore over total income of Rs 43.32 crore in the last financial year.