BCCL to pick up 15% in Hakoba via pref issue

BCCL to pick up 15% in Hakoba via pref issue

Author | Source: The Economic Times | Monday, Jul 18,2005 7:18 AM

BCCL to pick up 15% in Hakoba via pref issue

Hakoba Lifestyle (HALL) has proposed to make a preferential issue of equity shares to India's largest media house, Bennett Coleman & Co Ltd (BCCL). BCCL is to invest Rs 10.6 crore in HALL, and will have a 15% stake of the expanded equity capital. HALL is currently a wholly-owned subsidiary of the Rs 120-crore Pioneer Embroideries (PEL), one of Asia's largest embroidery manufacturers. Mumbai-based investment banking firm Singhi and Associates Advisors acted as advisors to PEL for the deal.

HALL is engaged in the retail sales of embroidery wear through its network of outlets under the Hakoba brand. The company is targeting to set up about 50 retail outlets nationwide in the current financial year, and is opening up its 22nd outlet in Chandigarh this week. HALL now has presence in about 14 cities, including the metros.

Bennett Coleman & Co publishes The Times of India, the world's largest selling English daily, and The Economic Times, India's largest and the world's second largest selling business daily, and has enviable presence in other print and non-print media.

Says PEL executive chairman Raj Kumar Sekhani, “Our association with BCCL will not only help us in expanding our network rapidly, but will also help in establishing and positioning the Hakoba brand through improved visibility.”

He added that Hakoba is recognised as a trustworthy, high quality and fashionable brand, and now the stress is on enlarging the product range and achieving brand preference among customers. After acquiring the Hakoba brand from its erstwhile promoters three years ago, PEL has been working towards innovative designs and fabric range to cater to the younger generation's fashion tastes.

PEL enjoys a dominant 14% market share in the wholesale EFL segment, and has attained this leadership position due to its ability to design, produce, stock and sell its products. It caters to the embroidery requirements of several leading garment exporters, apart from regularly exporting to countries like Nigeria, UAE, US, Brazil, among others.

Says Ajay Agrawal, director, PEL: “Though embroidery has always been in vogue in India among women, we are now witnessing increased usage of embroidery wear by men also. With a growing demand, and excellent brand recall of Hakoba, we aim to have a sizeable retail presence in the huge domestic garment segment.”

A senior member of BCCL's private treaties team said that the equity stake in HALL demonstrates the Times Group's firm commitment to support the Hakoba brand, as well as the organisation's commitment to grow and flourish the business of its partners.

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