On Friday, Aditya Birla Fashion and Retail Limited (ABFRL) said its board has officially agreed to raise Rs.1500 crore to Walmart-owned Flipkart Group by issuing a 7.8% stake on a preferential basis. The equity capital will be, however, raised at Rs.205 per share.
The Chairman Kumar Mangalam Birla (Aditya Birla Group) said that this partnership is an assertive endorsement of the growth potential of India and with this infusion, Flipkart Group will own a 7.8% equity stake in Aditya Birla Fashion and Retail Limited on a fully diluted basis. Also, the promoter and promoter group companies of ABFRL will hold about 55.13 per cent upon completion of the issuance.
The association plans to audaciously scale-up its existing businesses where it holds strong, market-leading positions while escalating presence in emerging high-growth categories such as athleisure, innerwear, casual wear, and ethnic wear, setting-up these as the new engines of growth for the company. The ABFRL will, however, aggressively accelerate the execution of its large-scale digital transformation strategy that will deepen the consumer connect of its brands.
Aditya Birla Fashion and Retail Limited Company said it has entered into a commercial endorsement in relation to the sale and distribution of its various brands. The MD of ABFRL also said this contract will provide a tremendous opportunity to build the scale of existing brands and expand its brand portfolio into emerging end-user constituents.
The Flipkart Group CEO, Kalyan Krishnamurthy said “We look forward to working with Aditya Birla Fashion and Retail Limited (ABFRL) and its well establishes and comprehensive fashion and its retail infrastructure as we address the promising opportunity of the apparel industry in India”. Moreover, the shares of Aditya Birla Fashion and Retail Limited were trading 3.19 per cent higher at Rs.158.30 apiece on BSE.