Samara Capital buys 18% in Monte Carlo for Rs 175 cr

US-based private equity fund Samara Capital has acquired a minority stake of 18% in Ludhiana-based Monte Carlo Fashions, part of the Nahar Group, for Rs 175 crore. "Private equity (PE) firm Samara Capital has acquired minority stake in Monte Carlo Fashions for Rs 175 crore," Oswal Woollen Mills, executive director, Dinesh Gogna told PTI .

Oswal Woollen Mills is the parent company of the Nahar Group of Companies (the Nahar Group). "The money from would be spent on meeting the company's working capital and capital expenditure requirements," Gogna said. "Under the deal, Samara Capital acquired 28,73,564 shares of the company's equity while promoters, including JL Oswal and his family, sold another 11,49,426 lakh equity shares to the PE fund," Gogna said.

The value of the share was assessed at Rs 435, he further said. The overall dilution of equity is 18% after Samara Capital acquired the stake, he added. "In order to have more focus on branded apparel business and to have fresh insight, we have joined hands with Samara Capital. Now, combined efforts to scale up will make the company more organised and professional in its approach," JL Oswal, chairman, Nahar Group, said.

Monte Carlo was carved out of Oswal Woollen Mills (OWM) Limited last year through its demerger in a bid to unlock value of the old brand. The demerger process was completed in 2011 with the approval of the Punjab and Haryana High Court.

Monte Carlo has embarked on a Rs 225-crore expansion plan at its Ludhiana plant to raise its garment capacity from 1.2 million pieces to 1.5 million pieces per annum. Monte Carlo clocked total turnover of Rs 370 crore in 2011-12 and it is now eyeing sales of Rs 500 crore in current fiscal.

The company offers summer as well as winter garments and has a wide range of sweaters, shirts, trousers, denims, lounge wear while winter and summer wear share the revenues almost equally.

The company at present operates close to 150 exclusive brand outlets in addition to having a product presence in excess of 1,200 multi brand outlets allover the country.