Move aimed to create two growth engines with distinct value creation trajectories and a well-articulated capital allocation strategy
Mumbai, April 01, 2024: The Board of Directors of Aditya Birla Fashion and Retail Ltd. (ABFRL), at its meeting today, has authorized the management of the Company to evaluate the vertical demerger of Madura Fashion & Lifestyle business from ABFRL into a separately listed company.
The proposed demerger will enable the creation of two separately listed companies as independent growth engines with distinct capital structures and parallel value-creation opportunities.
The Madura Fashion & Lifestyle business segment (MFL), consists of four lifestyle brands viz Louis Phillippe, Van Heusen, Allen Solly & Peter England along with casual wear brands viz. American Eagle & Forever 21, sportswear brand Reebok.
Post demerger, the remaining ABFRL will be focused on high-growth segments where there are tailwinds from a shift from unbranded to branded, premiumization, rise of super premium & luxury, and rapid growth in Gen Z focused digital-first brands.
- Value Retail – Value & masstige fashion retail play under Pantaloons & Style Up
- Ethnic Portfolio – One of India’s most comprehensive ethnic wear portfolios covering multiple occasions, price points, and consumer segments, including a designer wear portfolio
- Luxury – A fast-growing bridge to luxury & luxury platform of The Collective, Galleries Lafayette & select luxury brands
- Digital brands – TMRW – a leading portfolio of digital-first fashion brands
After the completion of the proposed demerger, ABFRL will raise growth capital within 12 months to infuse strength into its balance sheet, positioning itself well to pursue the large growth opportunity that lies ahead of it.
Mr. Kumar Mangalam Birla, Chairman, of Aditya Birla Group.
Over the years, our fashion and retail business, has grown from 5 brands in 2 categories to a dynamic portfolio of 20+ brands across all lifestyle categories. The evolution of this portfolio has seamlessly mirrored the shift in consumption trends, with a play encompassing all large value-creation opportunities.
Mr. Ashish Dikshit, MD, Aditya Birla Fashion and Retail Ltd.
“The restructuring will help bring in sharper focus anchored on a differentiated strategy aligned with the individual business segment. Each of these businesses has always been operated autonomously under respective CEOs.
About ABFRL
ABFRL is part of a leading Indian conglomerate, The Aditya Birla Group. With revenue of Rs. 12,418 Cr. spanning retail space of 10.8 million sq. ft. (as of March 31, 2023), it is India’s first billion-dollar pure-play fashion powerhouse with an elegant bouquet of leading fashion brands and retail formats.
The Company has a network of 4,753 stores across approximately 37,106 multi-brand outlets with 9,781 points of sales in department stores across India.
