Himatsingka eyes buyouts

Himatsingka Seide, the Bangalore-based silk fabric manufacturer, is looking at more acquisitions in the bed linen segment in the US and European markets.

The company announced today that it has entered into definitive agreements to acquire 70 per cent stake in Giuseppe Bellora SpA, Italy. Though the value of the deal was not revealed, Bellora generated revenues of about ¤29 million (around Rs 165 crore) in 2006.

Established in 1883, the Bellora brand is a pan European luxury brand in the bed linen segment.

Apart from exclusive stores in Italy, Spain, Portugal, Switzerland, Germany and France, the brand has a presence in up market departmental stores in fashion capitals such as London, Milan and Paris, in outlets such as

Harrods, La Rinascente and Bonne Marche.

This acquisition is in line with Himatsingka's strategy to acquire high-end distribution networks in the global home textile segment. The transaction is expected to be completed by February 2007.

Rajesh Kunnath, chief financial officer, Himatsinghka Siede , said, "The company is keen on acquiring bed linen brands and silk fabrics in the US and European markets to have presence across the value chain from manufacturing to retailing. The acquisition of Bellora will establish us as a global player and help us capture the value market taken by the retailers."

At present, Bellora is sold through 17 company-owned stores and 350 retail points. Post acquisition, Himatsingka intends to open more Bellora stores. "This will help in increasing the brands value realisation," added Kunnath.

In India, Himatsinghka recently launched Atmosphere, a luxury home furnishing brand, which registered sales of about Rs 25 crore in this financial year. In next six months, the company will open four Atmosphere stores.

It is also launching the brand's first overseas store at Dubai in March, followed by stores in Hong Kong, Kuala Lumpur and Singapore. Kunnath said that Himatsinghka would be locking up significant portion of the company's upcoming manufacturing facility in Karnataka for Bellora that could be later diversified for other brands too.

Himatsingka is investing Rs 400 crore in a setting up an integrated bed linen manufacturing facility located at the special economic zone (SEZ) in Hassan, Karnataka. Trial production at the new facility is likely to commence in February 2007.

He added, "In India there is no clear segmentation of the luxury bed linen market. However we might consider introducing the acquired international brands in India at a later stage."