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New Delhi:Value retailer V-Mart Retail Ltd., which is acquiring fashion stores Unlimited from Arvind Lifestyle Brands Ltd, plans to gradually rebrand them as its flagship V-Mart brand. The aim is to build a pan-India retail chain, a top executive at the company said.

On Thursday apparel retail Arvind Lifestyle Brands Limited (ALBL), announced signing of a definitive agreement to sell its value-fashion retail chain Unlimited to V-Mart Retail Ltd., for an estimated Rs150 crore in an all-cash transaction.

As part of the transaction, ALBL will sell assets of the 74 retail stores— warehouses, inventory and the ‘Unlimited’ brand to V-Mart at its book value. “Overall we will change it to V-Mart and see it as a one brand, one India focus," said Lalit Agarwal, managing director, V-Mart Retail on Friday. "The re-branding will happen gradually. “We will take a final call after 4-5 months, we actually want only one brand across India," he said.

Unlimited operates stores across South and West India and retails fashion apparel and accessories for men, women and children. The move gives V-Mart, that is largely present in north and east India, access to western and southern markets thereby giving it a national play.

As part of the transaction V-Mart will acquire fixed assets of all running stores and warehouses, leases, less than one year old inventory, and other current assets of the Unlimited business along with the store brand Unlimited.

To be sure, V-Mart currently invests 2 crore (including Rs1 crore in cap-ex and 1 crore in inventory) in any of its new store. This acquisition allows the company to acquire 74 existing stores in a new territory at a very similar cost, it said in a presentation on Thursday.

V-Mart that sells value clothing, footwear, accessories and general merchandise operates over 280 stores in the country. It focuses largely on consumption in tier 2, tier 3 and 4 markets.

With Unlimited—it will now have 356 stores with estimated revenues of over Rs2,000 crore. Unlimited retails apparel, across a range of private labels, partner brands and third-party brands with a strong focus on denims and women’s ethnic wear.

“There was a geographical gap which was there with V-Mart in the southern states. V-Mart is present in 190 cities—primarily in northern and north-eastern part of the country. We are not present in the southern and the western part. Now, Unlimited is present in seven states which including Maharashtra, Goa Gujarat, Karnataka, Tamil Nadu, Telangana, Kerala—where we were not present…now we've got this very good opportunity," he added.

V-Mart is not eyeing more acquisition targets in the market.

“With regard to Unlimited we will understand, filter, clean, integrate, take it to the next level where we are able to generate higher efficiency and higher outcome and we will keep growing our organic piece as is," Agarwal added.

In FY21—V-Mart reported Rs1,075.46 crore in revenue. In the current fiscal it plans to add 40 more stores under the V-Mart brand.

The company is recovering from what was turbulent quarter for most non-essential retailers. A surge in covid-19 cases in the months of April and May led to state-wide closures prompting non-essential stores to temporarily shut.

Agarwal said businesses has rebounded well compared to the last year's unlock. Almost 85-90% of the retailer's stores are now open, he said.

“We are going all out, we think the demand will continue and we have seen the reaction of the customer. People are tired of the pandemic. They are stepping out and when they are…they want to look good. They want to continue with their normal lifestyle," he added.

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