Gujarat Arth buys Poonam Sarees

 In a strategic move, Gujarat Arth Ltd, an Ahmedabad-based finance company, has acquired the well-known saree brand Poonam Sarees.

 Poonam Sarees, which has a market share of over 40 per cent in the branded sarees market in India, had posted a turnover of about Rs 100 crore in the last fiscal year.

 Gujarat Arth will pay the promoter of Poonam Industries a royalty of Rs 71 lakh a year as part of the assignment contract. Poonam brand was established over a decade ago, while Gujarat Arth was set up in 1995-96.

 Gujarat Arth has also applied to the authorities, seeking permission to change the name of the company from Gujarat Arth Ltd to Poonam Textiles Ltd.

 The Poonam Sarees brand was earlier promoted by Suresh Agrawal under the company Poonam Industries Ltd, with its base in Surat.

 Gujarat Arth has opted to retain the entire dealer and distribution network set up by Poonam Industries Ltd. Gujarat Arth is now marketing sarees and dress materials through the Poonam Sarees brand.

 According to the deed of assignment signed between Poonam Industries and Gujarat Arth on October 23, 2003, Poonam has transferred the trademark and the assets as per the balance sheets to Gujarat Arth with effect from July 1, 2003.

 In return, Gujarat Arth will pay an annual sum of royalty worth Rs 71 lakh to Poonam.