Grasim acquires Soktas India Private Limited

Grasim Industries Limited (“Grasim”) today signed a definitive agreement to acquire 100 per cent equity shareholding of Soktas India Private Limited (“SIPL”), from its current promoters, for an enterprise value of Rs.165 crore, subject to net debt and working capital adjustments, as of the closing date. The transaction will be funded by the company primarily out of internal accruals. SIPL will become a wholly owned subsidiary of Grasim upon completion of the transaction.

SIPL is currently a wholly owned subsidiary of SÖKTAŞ Tekstil Sanayi ve Ticaret A.S., world renowned producer and marketer of fabrics, with its main facilities in Soke, Turkey.

Today, SIPL is in the business of manufacturing and the distribution of premium cotton fabrics. Its state-of-the-art manufacturing facility is located at Kolhapur, Maharashtra. Its plant capacity is about 10 million metres per annum of finished fabric. SIPL sells premium fabrics in India under the ‘SÖKTAŞ’, ‘Giza House’ and ‘Excellence by SÖKTAŞ’ brands. The company is also a preferred supplier to leading Indian and global menswear brands. In fiscal March 2018, SIPL reported revenue and EBITDA of Rs.186 crore and Rs.31 crore respectively.

Says Thomas Varghese, Business Head – Textiles, Aditya Birla Group, “The acquisition is in line with Grasim’s linen business strategy to strengthen its presence in the premium fabric market. Increasing disposable income, fashion and quality orientation of Indian consumers has resulted in an increase in the demand for premium fabric over the years. This acquisition is a compelling strategic fit, and further strengthens our leadership in the premium cotton and linen fabric market in India.”

Says Muharrem Kayhan, Chairman, SÖKTAŞ Tekstil Sanayi ve Ticaret A.S. “We have no doubt that SIPL will continue to grow under the leadership of Grasim. We look forward to the ongoing success of our brands in the subcontinent and beyond.”

Grasim already has a significant presence in India’s premium linen fabric market, through its leading brand ‘Linen Club’. It is India’s top linen fabric manufacturer. Its Linen Club has given the evolving Indian fashion industry an edge which will be further bolstered by the ‘SÖKTAŞ’, ‘Giza House’ and ‘Excellence by SÖKTAŞ’ brands.

The completion of the transaction is subject to requisite approvals being obtained.