Kumar Managalam Birla to sell stake in Madura
04 Jul 2011
Kumar Mangalam Birla's latest move is aimed at unlocking the value of his privately held group company Madura Fashion & Lifestyle, formerly Madura Garments.
This comes in the wake of private equity funds making offers to buy the stake.
Madura, which owns brands such as Louis Philippe, Van Heusen, Allen Solly and Peter England, is a division of Aditya Birla Nuvo.
According to soruces, Apax Partners with assts of over $26 billion under management globally, has had several rounds of discussions with Aditya Birla Group's senior executives, and with Kumar Mangalam Birla, in the past six months.
Apax has indicated its interest in a buyout but Birla has stated only a stake sale under 26 per cent would be agreeable to him. The talks between the two parties have reached a dead end on the issue and though PE funds have indicated valuations of around $800 million, Aditya Birla Group is asking for $1 billion.
Meanwhile, Madura which had been awash in the red till two years back has returned to profitability. It has pared costs drastically, controlled unprofitable retail expansion and decided to be a fashion brand rather than a fashion retail business.
