SP Apparels to acquire Young Brand Apparel for Rs 223 crore

CHENNAI: Apparel manufacturer and exporter SP Apparels has signed an agreement to acquire 100% stake in Young Brand Apparel Private Limited (YBAPL), the subsidiary of Bannari Amman Spinning Mills, along with the company's garment unit situated at Palladam and land and building situated at SIPCOT (State Industries Promotion Corporation of Tamil Nadu Limited) for a value of Rs 223 crore.

As per the agreement, SPAL plans to acquire a 51.33% stake in YBAPL from Bannari Amman and undertake to acquire 49% stake in YBAPL from joint venture partners. The acquisition will be funded by a balanced combination of internal accruals and borrowed capital.

With this acquisition, SPAL intends to diversify product offerings, expand customer base and further penetrate the US market. The land parcel is expected to boost SPAL’s manufacturing capacity to fuel future expansion, the company said in a statement.

Incorporated in December 2006, YBAPL is a manufacturing and export company that manufactures Intimate Wear for brands like American Eagle, Jockey International, Marks & Spencer and Benetton. The company exports to the US, UK, Japan and Canada.

“It’s a strategically important acquisition which is in line with our vision to diversify into other textile and apparel categories, further strengthen our export basket, market presence and build a more broad-based business model," P Sundararajan, chairman and MD, SP Apparels, said.

YBAPL reported a revenue of Rs 329 crore for the fiscal year ended March 31, 2023.