Reliance Capital Partners, a part of the Anil Dhirubhai Ambani Group, has bought 14.55 per cent stake in Maxwell Industries, the maker of VIP and Lovable brands of innerwear, for Rs 45 crore (Rs 450 million).
The investment was a made at a price of Rs 31.65 per share and values the company at over Rs 300 crore (Rs 3 billion). The acquisition was done through preferential allotment of a mix of equity and optionally convertible preference shares.
Mumbai-based Singhi & Associates was advisor for the deal.
In a consolidation move, Maxwell had purchased the manufacturing assets of group entities -- Hybo Hindustan and Gomma Industries.
It had merged two other group companies with itself -- Microtex India, which manufactures the Live-in brand of apparels, and Lovable Lingerie, maker of Lovable and Daisy Dee brands. Post-consolidation, the group's 40 brands will come under Maxwell's fold.
The resource raised though Reliance acquisition will be used for the company's Rs 250-crore (Rs 2.5 billion) expansion plan. This includes increase of production capacity, international brand launches and export outsourcing projects.
The company is set to ink joint venture and outsourcing agreements with international innerwear brands. Alliances have been concluded with DBA Europe, FILA and Playboy Jeans.
Among its other plans, Maxwell plans to enter the retail space with its Lovable brand. It is looking at malls to drive its retail plans.
"Sale of branded goods in these categories of innerwear and lingerie is expected to multiply on the back of increasing fashion consciousness," said sources close to the company.
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