Cravatex hit an upper circuit limit of 20% at Rs 455.60 after footwear retail chain Metro Brands has signed a share purchase agreement to acquire Cravatex Brands to expand its presence in the sports and athleisure space in India.
Meanwhile, shares of Metro Brands were down 1.18% at Rs 885.45 on the BSE.Cravatex Brands (CBL), an unlisted division of Cravatex, is a retail, brand licensing, distribution and sourcing company that has the exclusive long‐term license for the Italian sportswear brand FILA, owns sportwear brand Proline, and represents other international brands.
The total consideration payable is based on the enterprise value of CBL, i.e., Rs 202.17 crore, subject to the terms and conditions and adjustments (based on the outstanding debt of CBL as on the completion date) set out in the SPA.
During the last financial year, CBL reported a turnover of Rs 156.53 crore. The total outstanding debt of CBL as per its audited accounts dated 31st March 2022 was approximately Rs 163 crore.
This acquisition fits Metro Brands' strategic vision to expand its presence in the sports and athleisure space in India. This opportunity will help the company leverage its expertise in brick-and-mortar and e-Commerce retail while serving the growing need of the consumer in the sports and athleisure category.
Through this acquisition Metro Brands will receive exclusive rights for Proline and for the sale and distribution rights of FILA across formats, including Exclusive Brand Stores, Multi Brand Stores, Airport Stores, Distribution, Online Marketplaces and Webstores, in India.
The acquisition is based on fulfilment of closing conditions by both parties. Paragon Partners, an existing investor in Cravatex Brands, will also sell its entire stake as part of this transaction.
More From This Section
"This acquisition fits our strategic vision at Metro Brands Ltd to leverage our expertise in brick‐and‐mortar and e‐commerce retail while serving the growing need of the consumer in the sports and athleisure category. We are truly committed to our vision to be India's largest specialty footwear and accessory retailer. With this acquisition, we look forward to elevating the sportwear landscape in India," said Nissan Joseph, chief executive officer, Metro Brands.
Cravatex has evolved into a global retail, brand licensing, distribution and sourcing company with a presence across the Indian Subcontinent, United Kingdom, Europe, North Africa and the Middle East. Its model is a combination of spotting opportunities, developing the best product, delivering high quality customer service and providing commercially sound marketing strategies.
On a consolidated basis, Cravatex reported net loss of Rs 11.11 crore in Q1 June 2022 as against net loss of Rs 11 crore in Q1 June 2021. Net sales rose 31.46% to Rs 162.40 crore in Q1 June 2022 over Q1 June 2021.
Powered by Capital Market - Live News