Acquisition process likely to be completed by October
GHCL isset to enter the $40-billion US and UK markets accounting for 60 per cent of global home textile trade.
It isin the process of expanding its capacity in spinning from 85,000 to 1,40,000 spindles over the next 18 months.
Ahmedabad, June 19
The Rs 515-crore Gujarat Heavy Chemicals Ltd (GHCL) today announced the acquisition of Rosebys, UK's largest home textile retail chain company, for $40 million, Mr Sanjay Dalmia, Chairman of the company, said here.
The Veraval-based GHCL Ltdhas signed an agreement to acquire 100 per cent of the shares of Rosebys.
In a release here, Mr Dalmia said the equity cost of acquisition will be funded through the resources raised from various domestic and foreign institutions in the recent past. The acquisition process is likely to be completed by October 2006, after which GHCL would have complete control over Rosebys' operations.
Rosebys has a strong presence in bedding, curtains and kids garments with more than 300 retail outlets across the UK and an annual turnover of close to $250 million. More than 2,000 people are currently being employed by Rosebys in the UK.
Post-acquisition, GHCL would become the world's only integrated home textile company with a presence across spinning, weaving, product design and development, sourcing and distribution to retail stores at a global level.
Mr Dalmia said, "It would be ideal combination of low-cost strong manufacturing base with a large established marketing platform to put us on the fast track growth."
In the textile sector, GHCL had earlier acquired Dan River Inc, a leading player in the US textile markets, with a turnover of $250 million in home textiles. It had a widest sales and distribution network within the US catering to the largest retailers and preferred suppliers to large retailers such as JC Penny and Linen & Things, Wal-Mart, Bed, Bath & beyond. With these acquisitions, GHCL is set to enter the $40 billion US and UK market accounting for 60 per cent of global home textile trade.
GHCL in India is already in the process of expanding its capacity in spinning from 85,000 to 1,40,000 spindles over the next 18 months. The company has put in the process of completing the modern home textile manufacturing facility at Vapi, South Gujarat, at a cost of Rs 230 crore, the production for which has commenced in March 2006. The Vapi unit, at 90 per cent capacity, is likely to generate $100 million in revenues. Post-expansion, GHCL would become the first company in India to have integrated production facilities from spinning, weaving, finishing to making up and would rank amongst top three players in India in the fast-growing home textile segment, he added.
In the chemicals' space, GHCL's subsidiary had earlier acquired the controlling stake in SC Bega Upsom in Romania. With these acquisitions, GHCL's global capacity would be 18,00,000 million tonnes per annum (mtpa) on completion of expansion programs in India and Romania from the current capacity of 600,000 mtpa, Mr Dalmia said.
GHCL, a multi-product progressive organisation, is a part of the Dalmia Group. The company was also moving up the textile chain into the value-added segment of home textiles project at Vapi.