SP Apparels to acquire Young Brand Apparel

Tamil Nadu, India – 6 February, 2024 –  S.P. Apparels Ltd., (SPAL), a leading apparel manufacturer and exporter, has signed a definitive agreement to acquire 100 per cent stake of Young Brand Apparel Private Limited (YBAPL) the subsidiary of Bannari Amman Spinning Mills Limited along with the garment unit situated at Palladam of Bannari Amman Spinning Mills Limited and land and building situated at SIPCOT (The State Industries Promotion Corporation of Tamil Nadu Limited) for a value of Rs.. 223 crore.

SPAL intends to purchase a 51.33 per cent stake in Young Brand Apparel Private Limited from Bannari Amman as part of a strategic acquisition initiative. Additionally, SPAL seeks to purchase a 49 per cent stake in YBAPL from joint venture partners. SPAL intends to finance this acquisition using a well-balanced mix of borrowed funds and internal accruals.

Through this acquisition, SPAL will be able to further broaden its target markets and customer base while using each other’s capabilities to diversify its product offerings. The new manufacturing capacity from the land parcel is anticipated to support SPAL’s future growth.

YBAPL is a Tamil Nadu-based manufacturing and export company that was founded in December 2006. For companies like American Eagle, Jockey International, Marks & Spencer, and Benetton, the company produces intimate apparel. The business exports to the US, UK, Canada, Japan, and other nations.

This acquisition will help S.P. Apparels to further expand to new intimate wear segment. The acquisition of YBAPL will bring in additional revenue up to Rs. 400 crore for the financial year 24 – 25 for SPAL.

Commenting on the acquisition, P. Sundararajan, Chairman and Managing Director, S. P. Apparels Limited said, “YBAPL is a prominent name in the Intimate Wear manufacturing segment with a robust presence in key global markets and strong manufacturing capacity. The company is scaling up its business in markets like the US, UK, etc. 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. YBAPL will improve the cross-sell synergy in terms of customer base and product offerings, as we are working towards further penetrating the US market. The acquisition will not only strengthen our export spread but also lay a strong foundation for sustainable and resilient business growth for us.”