Aditya Birla Fashion and Retail (ABFRL) rose 3.83% to Rs 180.10 after the Competition Commission of India (CCI) approved the Flipkart-Aditya Birla Fashion deal.
Competition Commission of India (CCI) on Wednesday (20 January 2021) said it had approved the acquisition of a 7.8% minority stake in Aditya Birla Fashion and Retail by Flipkart Investments.
The deal was announced in October 2020. The board of ABFRL had approved raising Rs 1500 crore through preferential issue of equity shares to Flipkart Group at Rs 205 per share.
With this infusion, Flipkart Group would own 7.8% equity stake in ABFRL on a fully diluted basis. The promoter and promoter group companies of ABFRL will hold about 55.13% upon completion of the issuance.
ABFRL plans to use this capital to strengthen its balance sheet and accelerate its growth trajectory. The company plans to aggressively scale-up its existing businesses where it holds strong, market leading positions while increasing presence in emerging high-growth categories such as innerwear, athleisure, casualwear and ethnic wear, establishing these as the new engines of growth for the company.
Aditya Birla Fashion and Retail is a premium clothing retail chain. It reported a consolidated net loss of Rs 186.32 crore in Q2 FY21 as compared to a net loss of Rs 0.84 crore in Q2 FY20. Net sales during the quarter dropped 55.4% YoY to Rs 1028.13 crore.
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