SP Apparels Ltd (SPAL), a renowned apparel manufacturer and exporter, has entered into a definitive agreement to acquire Young Brand Apparel Private Limited (YBAPL), a subsidiary of Bannari Amman Spinning Mills, for Rs 223 crore. This acquisition encompasses the garment unit located at Palladam of Bannari Amman Spinning Mills, along with the land and building situated at SIPCOT (The State Industries Promotion Corporation of Tamil Nadu Limited). SP Apparels intends to acquire a 51.33 percent stake from Bannari Amman in Young Brand Apparel Private Limited as part of its strategic acquisition initiative, while also planning to procure a 49 percent stake in YBAPL from joint venture partners.
To finance this strategic move, SP Apparels will utilize a balanced combination of internal accruals and borrowed capital. Established in December 2006, YBAPL operates as a manufacturing and export company based in Tamil Nadu, specializing in intimate wear production for esteemed brands such as American Eagle, Jockey International, Marks & Spencer, and Benetton, with exports spanning across the US, the UK, Japan, and Canada. With the acquisition, SPAL aims to broaden its product range, expand its customer base, and target new markets.
Furthermore, the acquisition of the land parcel is anticipated to enhance SPAL’s manufacturing capacity, facilitating future growth and expansion opportunities. P Sundararajan, chairman and managing director of SP Apparels Limited, remarked, “YBAPL holds a prominent position in the intimate wear manufacturing segment, boasting a strong presence in key global markets and robust manufacturing capabilities. The company is actively expanding its operations in markets like the US, UK, and beyond.”
Key Points
- Acquisition Details: SP Apparels Ltd (SPAL) is acquiring Young Brand Apparel Private Limited (YBAPL) for Rs 223 crore from Bannari Amman Spinning Mills. The acquisition includes a garment unit and land/building assets.
- Stake Acquisition: SP Apparels will secure a 51.33 percent stake from Bannari Amman and intends to acquire a 49 percent stake from joint venture partners in YBAPL.
- Financing: The acquisition will be funded through a mix of internal accruals and borrowed capital.
- YBAPL Profile: YBAPL, founded in 2006, specializes in manufacturing intimate wear for renowned brands and exports to countries including the US, UK, Japan, and Canada.
- Strategic Rationale: SP Apparels aims to diversify its product offerings, expand its customer base, and target new markets through the acquisition.
- Manufacturing Capacity Boost: The acquisition of land assets is expected to enhance SPAL’s manufacturing capabilities for future expansion.
- Industry Recognition: YBAPL is recognized for its strong presence in global markets and robust manufacturing capacity, particularly in the intimate wear segment.
About SP Apparels
S.P. Apparels Ltd., a prominent manufacturer and exporter of knitted garments catering to infants and children in India, was established in 1988 by Mr. P. Sundararajan, a forward-thinking individual who embraced the garment export industry with the ethos of “We Dream, We Believe, We Achieve”. The company boasts a portfolio of high-quality apparel produced for globally recognized brands like Angel & Rocket, HEAD, and Natalia, along with retailing men’s wear under the Crocodile brand in India. With fully integrated manufacturing facilities enabling comprehensive garment production from greige fabric to finished items, S.P. Apparels Ltd. achieves a daily capacity of 250,000 pieces.
Utilizing a real-time system-driven control mechanism and lean manufacturing setup, the company upholds stringent quality standards and is recognized as a Government of India sanctioned 3-Star Export House. Headquartered in Tirupur, India, the company operates through various offices across Bengaluru, Chennai, Delhi, Mumbai, and Kolkata, with additional international presence in the UK and the USA. For inquiries, the company can be reached through its website, phone, or email.
About Young Brand Apparel Private Limited (YBAPL)
Young Brand Apparel Private Limited operates in the fashion and textile industry, specializing in the distribution of clothing products including women’s wear, men’s wear, and kid’s wear. With a registered capital of INR 80.00 crore and a total paid-up capital of INR 65.16 crore, the company’s financial performance for the fiscal year ending on 31 March, 2021, reflects operating revenues ranging from INR 100 crore to INR 500 crore. Established on 11 December, 2006, in Kanchipuram, Tamil Nadu, the company is governed by four directors, including Sangampalayam Vedanayagam Arumugam and Kulandai Samy Gounder Sadhasivam, among others. Its online presence can be found at youngbrand.in. According to AmbitionBox, the company holds a rating of 3.1 stars based on 25 employee reviews.
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