Aditya Birla Fashion and Retail Ltd (ABFRL) on Saturday announced that it has entered into a definitive agreement to acquire 51 per cent stake in TCNS Clothing, the parent company of W, Aurelia, Wishful, Folksong and Elleven. The value of the promoter stake for TCNS, ABFRL said, is ~Rs 1,650 crore for the 51 per cent stake. “The transaction will be carried out through: 1) acquisition of the founding promoter’s stake through a SPA and a conditional public open offer followed by 2) merger between the two entities,” ABFRL said in a regulatory filing. 

“This deal is yet another marker of the Aditya Birla Group’s faith in the dynamism and buoyancy of the Indian consumer economy. For ABFRL, the TCNS deal is indeed a significant milestone as it complements our existing portfolio of exceptional brands across the entire spectrum of Indian fashion,” said Kumar Mangalam Birla, Chairman, Aditya Birla Group. 

Talking about the acquisition, Ashish Dikshit, Managing Director, ABFRL, said, “This transaction is a pivotal piece of our strategy of building India’s most comprehensive ethnic wear portfolio.” ABFRL has, over the last 5 years, built its ethnic portfolio through a series of strategic and calibrated actions and through this deal, expects to take its ethnic wear portfolio to Rs 5000 crore in the next 3 years.

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Meanwhile, Anant Daga, Managing Director of TCNS, said, “ABFRL’s proven brand- building capability, distribution strength and strong ecosystem of partners will help our brands into its next phase of growth and profitability.” TCNS has presence across 650+ exclusive brand outlets, 2300+ large format store outlets and 1100+ multi-brand outlets, located in 29 states and two union territories in India. 

“As part of the transaction, ABFRL will make a conditional open offer to acquire up to 29 per cent stake at Rs 503 per share from public shareholders and acquire the remaining stake from the founder promoters to reach an overall shareholding of 51 per cent in TCNS,” the stock exchange filing said. Post this, TCNS will be amalgamated with ABFRL under the merger scheme and its public shareholders will receive 11 shares of ABFRL for every 6 shares that they hold in TCNS.