Koovs agrees investment deal with Indian retail group
AIM-listed online fashion retailer Koovs has won the backing of a major Indian retail group in a ‘transformational’ deal that will help it raise cash and reach more customers.
The company announced on Wednesday that Future Lifestyle Fashions Limited, part of Future Group, has agreed to subscribe for up to a 29.9% stake in Koovs.
Subject to the satisfaction of certain conditions, the agreement will see Koovs issue Future Lifestyle Fashions Limited with 57,876,600 new ordinary shares at a price of 10p per share. The deal will raise around £5.78 million in cash.
With over 60 brands and more than 2,000 retail stores, Future Group is one of India’s leading consumer goods companies, and one of the world’s top 10 fashion apparel companies by sales volume.
Its portfolio of 30 fashion brands are distributed through exclusive brand outlets, department stores and multi-brand retailers, as well as company-operated chains. It is described as a “unique player in the Indian fashion industry” due to its integrated ‘design to distribution’ model and presence across all key segments within the fashion industry.
"This marks a giant step forward in the Koovs' journey to win the e-fashion market in India,” Lord Alli, chairman of Koovs, said about the partnership. “FLFL with its leadership position as an integrated branded fashion player and the Koovs brand and technology platform are an unbeatable combination. This investment will bring enormous benefits to our customers and partners as well as significant value for all shareholders."
Kishore Biyani, Future Group managing director and group CEO, added: "In FLFL we have successfully created, grown and invested in leading Indian fashion brands and are excited to partner with Koovs to continue building on FLFL's ambition. This investment would complement the existing value chain for FLFL as an integrated branded fashion player. FLFL's strong retail presence backed by owned brands coupled with Koovs online strategy will help reach more customers and create value for all stakeholders.”
The announcement sent Koovs shares soaring in mid-afternoon trading on Wednesday.
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