BENGALURU: Bengaluru-based apparel manufacturer Gokaldas Exports has said its recent acquisition Matrix Clothing brings a stronger position in the knits category, introduces new customers, improves geographical spread to Europe and complements its investment in fabric processing.
Responding to analysts’ query, vice-chairman and MD of the company Sivaramakrishnan Ganapathi said products that Matrix clothing sells have better realisation, and therefore, it expects better margins.
“They have also worked with premium customers. And that’s the reason why they have a much higher FOB (Freight-on-Board) value as compared to most of the list manufacturers. …there is further possibility of improvement in EBITDA margins given the product profile that exists. And it is our endeavour to further take it up,” says the MD of Gokaldas Exports.
Gokaldas Exports recently signed a pact with Matrix Clothing Private Limited (MCPL) to acquire 100% of equity share capital of Matrix Design & Industries for an enterprise value of Rs 489 crore. The acquisition would be partly (Rs 247.5 crore) funded by way of preferential allotment of shares of Gokaldas Exports through share swap.
The Matrix Clothing group is a manufacturer of men’s, ladies’, and children’s knitwear apparel for several global brands across Europe, the UK, and North America. The group operates out of Gurgaon, Haryana and has five manufacturing facilities (4 in Gurgaon, Haryana and 1 in Ranchi, Jharkhand).
Through this deal, Gokaldas receives access to the knit apparel business segments, a mutually exclusive global customer base, greater access to European and the UK markets, geographical diversification and low-cost capacity expansion potential in the future.
S Ganapathi says Gokaldas’ existing knit fabric mill would complement Matrix as some of the fabric output of Gokaldas’ knit mill can be utilised as a good portion for Matrix’s own consumption.