Mumbai: Textile major, Bombay Rayon Fashions Ltd (BRFL), said on 4 July it has acquired a controlling stake in Leela Scottish Lace for Rs155 crore.
“We have signed the MoU with the Leela group tonight,” the company’s managing director, Prashant Agarwal, told PTI here tonight.
Leela Scottish Lace belongs to the hospitality major, the Leela Group, and has its manufacturing facilities at Chennai, Bangalore, Kochi and Thiruvanthapuram.
The Leela Group’s official Venu Krishnan said movable and a few immovable properties would go to BRFL.
Krishnan did not say how the Rs155 crore would be used by the Leela Group.
“Leela Scottish is a private limited company and the management will decide on the deployment of the resources,” he said.
BRFL will pay 25% of the amount at the time of signing and the balance within the next 45 days, Agarwal said.
The business of Leela Scottish Lace will be transferred to a wholly-owned subsidiary of BRFL called Bombay Rayon Apparel Ltd.
Nearly 16,000 employees of Leela Scottish and the business will be transferred to the new subsidiary and all customers of Leela Lace will be integrated, he said, adding the acquisition will bring in many synergies to BRFL’s business.
Earlier, the Leela Group had said it was looking for a strategic partner who would take over the production of Leela Scottish Lace.
The Leela Group company has global majors as its clients such as Wal-Mart which accounts for nearly half of the company’s revenues.
Other big clients include the likes of Ann Taylor, Banana Republic and Gap.