ABFRL takes over Forever 21 India
In this article (5)
Aditya Birla Fashion and Retail (ABFRL) will acquire US-based clothing brand Forever 21 India from existing local franchise partner Diana Retail.
The Rs.175-crore (US$26 million) transaction involves a business transfer agreement, not share transfer, says ABFRL in a filing with the Bombay Stock Exchange.
The Forever 21 business will become part of ABFRL’s Madura Fashion & Lifestyle division.
ABFRL was formed after the consolidation of the branded apparel businesses of the Mumbai-based Aditya Birla Group, one of India’s largest conglomerates. It has a presence in 375 Indian cities.
Forever 21 has a network of more than 700 stores worldwide.
“With the acquisition of Forever 21, we aim to create a strong foothold in the womenswear business in the western-wear segment, which is growing at 20 per cent,” ABFRL MD Pranab Barua said in May when the company announced it would enter into a deal to acquire Forever 21’s online and offline rights for the Indian market.
In March, it is reported that Flipkart’s online fashion store Myntra, which sells Forever 21 products, was seeking to take over management of the US brand’s India brick-and-mortar stores.
Questions & Answers
Q.Which company is taking over Forever 21's operations in India?
Which company is taking over Forever 21's operations in India?
Aditya Birla Fashion and Retail (ABFRL) will acquire the US-based clothing brand Forever 21 India. It is taking over from the existing local franchise partner, Diana Retail, to integrate it into its business.
Q.How much is ABFRL paying for the acquisition of Forever 21 India?
How much is ABFRL paying for the acquisition of Forever 21 India?
The transaction for Forever 21 India is valued at Rs.175-crore, which is equivalent to US$26 million. This figure was confirmed by ABFRL in a filing with the Bombay Stock Exchange.
Q.What is the strategic reason for ABFRL acquiring Forever 21 India?
What is the strategic reason for ABFRL acquiring Forever 21 India?
ABFRL aims to establish a strong presence in the womenswear segment, specifically within western-wear, which is experiencing 20 per cent growth. This acquisition will help them achieve that goal.
Q.Will Forever 21 India become part of an existing ABFRL division?
Will Forever 21 India become part of an existing ABFRL division?
Yes, the Forever 21 business in India will be integrated into ABFRL’s Madura Fashion & Lifestyle division. This expands the existing portfolio within one of India's largest conglomerates.
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