In a $26 Million dollar
transaction, Aditya Birla Fashion and Retail has become the joint venture
partner of US fast fashion major, Forever 21, replacing DLF Brands. The company
is acquiring Forever 21 exclusive offline and online rights in the country,
including its existing store network.
The apparel company, which
currently has 12 stores across Mumbai, Delhi and Bengaluru, had been
dissatisfied with the pace of growth and consequently opted to team up with
ABFRL. The Company had originally planned for 50 stores in five years, in
addition to Chandigarh; the US firm is planning stores in other Tier II cities
such as Coimbatore and Surat.
While the US firm also has its own
e-commerce platform, it currently sells its clothes and accessories through the
fashion portal Myntra. The JV between Forever 21 and DLF brands was pitching
perfect. Forever 21 was to occupy space at a competitive rent in DLF own malls.
But over a period of time, it turned out that DLF malls were not always the
most lucrative shopping destinations.
That meant Forever 21 needed to
have a different expansion plan, given that competing brands like H&M and
GAP are aggressively multiplying store presence. This is the third major brand
that DLF Brands has let go. Others include Mango and Sephora. At the moment
Mothercare, Sunglass Hut and Claires are the prominent international brands
that DLF still has under its umbrella.
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