S. Kumars acquires Scottish fashion chain (Lead, changing dateline)June 3rd, 2008 - 7:35 pm ICT by IANS
New Delhi/Glasgow, June 3 (IANS) After month-long speculation and secrecy, S. Kumar Nationwide Ltd, a company promoted by the Mumbai-based Kasliwals, has now emerged as the mysterious buyer of Scottish fashion chain Internacionale. “S. Kumars acquired the Scotland based Internacionale in early May,” Shrikant Hazare, president for marketing and communication with the croup, confirmed to IANS, but declined to divulge any further details, financial or otherwise.
S. Kumars, which has ambitious overseas acquisition plans, already retails international luxury brands such as Alfred Dunhill and Escada in India and owns the Reid and Taylor, Carmichael House and Belmonte brands.
It is also one of India’s leading textile and apparel companies, whose products are sold in over 30,000 outlets across the country. Bollywood star Amitabh Bachchan is among its brand ambassadors.
The Scottish company was put for sale due to financials problem but both the buyer and the seller had kept the deal a secret because of regulatory issues, company sources familiar with the acquisition said.
“There were some regulatory issues involved due to a de-merger of the company’s retail business into the new entity, which has been named Brandhouse Retails Ltd on May 5,” said one source.
“We will make the deal public once these issues are resolved.”
Some 1,000 workers of the Scottish company in Glasgow were celebrating when they learnt that an unnamed overseas firm had purchased Internacionale after it was put up for sale following the collapse of its parent company earlier this year.
The future of the chain became uncertain when the Glasgow-based parent company Ossian Retail Group sold its 25 million pound debt to an investment company, Agilio.
There were rumours the group would be broken up, threatening the livelihood of workers at Internacionale’s 105 stores in Britain, including nearly 30 in Scotland.
Although the buyer was not named, there was speculation that the firm was from India and later the Glasgow-based Herald newspaper also identified the buyer as S. Kumars Nationwide - a household brand in India.
“I can tell you that this deal has saved almost 1,000 jobs, and I’m very pleased about that,” said David Brock, Ossian’s non-executive chairman, who also confirmed the sale of Inernacionale May 1.
Internacionale’s sister company Au Naturale, a homeware retailer, was sold to Elaine McPherson, a Scottish entrepreneur and founder of the fashion chain MK One.
The problems facing Internacionale and Au Naturale were said to be associated with a slump in high street spending in Britain, arising from the global credit crunch, as well as mismanagement.
The two companies were said to have collapsed amid a cash flow crisis, in which they had been unable to meet many of their rent and service charge obligations for their outlets.
Graham Martin, one of three men appointed joint administrators of Internacionale Ltd, which owned and operated both Internacionale and Au Naturale, said in early May the company had suffered financial difficulties for the past nine months.
“The problems were caused partly by the downturn in the retail markets and partly by internal problems - mainly operational difficulties in the supply of stock from its warehouses to the retail outlets,” he said in a statement.
However, David Brock said: “Both companies, Internacionale and Au Naturale, had been trading extremely well. But basically, we lost the support of the banks. That’s what precipitated all the problems in the first place.”
Tags: alfred dunhill, amitabh bachchan, apparel companies, belmonte, carmichael, company sources, croup, fashion chain, investment company, livelihood, luxury brands, merger of the company, overseas acquisition, regulatory issues, retail business, retail group, s kumar, s kumars, scottish company, star amitabh bachchan