RSWM buys 50% stake in Spain's SISA

RSWM, an integrated textile maker, has acquired a 50% equity stake in SISA S.A. (SISA) of Spain for an undisclosed amount.

SISA, in 2006, reported revenues of about euro 12 million, and has its own yarn capacity of 12,000 spindles, along with relatively smaller trading operations. SISA commands a strong brand reputation in Europe and its yarns obtain premium pricing in the market.

The venture will enable RSWM to considerably expand its footprint in the higher value added international yarn market. The company will now be rechristened as RSWM SISA S.A.

Commenting on the transaction, Riju Jhunjhunwala, joint managing director, RSWM said, "SISA brings with it a specialty and value-added yarn business in the international market, with a strong customer profile. It adds an established and well reputed marketing network to our operations, which will enable us to obtain better realisations for our high-end yarns.

"RSWM has been keen to expand its yarn business, especially in the value-added space and the transaction is a part of a series of initiatives that we are implementing to enhance our business operations, rapidly and profitably."

The partnership with SISA will enable the company to significantly enhance its presence in the higher value-added international yarn market. Additionally, SISA will substantially enhance its yarn outsourcing from the company, thereby increasing the company's international yarn volumes. The company will market its superior and specialty yarn through SISA to a broad range of high end fabric makers in Europe.

SISA will operate as a jointly managed company. The existing management team of SISA led by Mr. Alex Sala Lanz, its General Director, will continue to look after SISA's day-to-day operations.

The transaction will result in capital infusion in SISA which will augment SISA's resources for growth.