A joint statement made by Flipkart and Arvind Fashions stated that they would collectively work and develop better opportunities to design and develop products and cost-effective price points.
For this, Flipkart has acquired a minority stake in Arvind Youth Brands by investing Rs 260 crore. Arvind Youth Brands is a newly formed subsidiary of Arvind Fashions (AFL). However, the former hasn’t spoken about their stake but, it is said to be massive. But, according to the sources about 27 percent of the stake has been acquired by the Flipkart. This act is clearly to build up and strengthen Flipkart’s mid-market portfolio.
According to J Suresh, MD & CEO at Arvind Fashions, “The partnership with the Flipkart group will help us accelerate our online growth strategy as we focus our efforts on developing an omni-channel retail approach for Arvind Youth Brands and Flying Machine.”
Customary approvals and processes were subjected for the transaction, where Metta Capital Advisors acted as the financial advisors to Arvind Fashions for the same (Transaction).
Kalyan Krishnamurthy, Chief Executive Officer of Flipkart Group said, “Through this investment, we look forward to partnering with the team at Arvind Youth Brands to continue to grow the market for its portfolio of products.” He then also added that the Flying Machine is a well-known brand across the sub-continent.
As it is evident that the fashion market was the worst to suffer from this lockdown period, online segments will surely want to rejuvenate and bring back the sales.
"More brands in fashion will look for these kinds of deals, either with Flipkart or Amazon, as they can’t ignore the online channel anymore and it is difficult for them to build this on their own," said Satish Meena, senior analyst at Forrester Research.
Magazine
