Sri Lanka’s Hela Clothing Group has secured Rs. 1.2 billion capital infusion by a mix of shareholder and new private equity investment funds
Hela Clothing Group, which is a Sri Lankan apparel manufacturer, has reportedly announced that it had secured a capital infusion of Rs. 1.2 billion by way of a mix of shareholder and new private equity investment funds from a private consortium whose lead investor has a wide portfolio including private equity investments in the fashion and retail space.
A.R. Rasiah, the former Finance Director at Nestle Lanka PLC, former Senior Director of Nations Trust Bank PLC, former Chairman of Atlas Axillia Ltd., and director at many other listed and non-listed entities, has been a long-standing Director of the Company is to now assume the role of Chairman.
Overwhelmed by the interest from private equity funds to invest in Hela, Rasiah together with the Company’s Board of Directors were pleased to secure an anchor partner with a wealth of retail and supply chain expertise, the Daily FT has reported.
“The focus for the past twelve months was to right-size the business and drive free cash flow generation through operational excellence, prudent cost management together with customer and supply chain optimisation strategies. With the business now having made significant progress in those areas the focus is now around balance sheet strengthening both through raising equity and building cash reserves through operations,” Rasiah has been quoted saying.
Hela plans to use this capital infusion on several fronts.
The majority of the proceeds is to be used to repay debt and replenish working capital thus, strengthening the Company’s balance sheet and the balance of the funds will be utilised to fuel growth by enhancing and expanding its manufacturing footprint in Africa and for further operational streamlining through investments into IT and Innovation, beginning with the group wide ERP system being upgraded in partnership with SAP solutions.
OSL take:
Sri Lanka’s Hela Clothing has expanded to the overseas markets and as stated by the company’s new Chairman, the local venture is on a continuous evolving process. Sri Lanka’s apparel sector is on a growth path with the benefits of several trade concessions enjoyed by the country. The latest data released by Sri Lanka’s Central Bank has also revealed the developments in the country’s apparel sector. Therefore, foreign businesses/investors could look at investment opportunities in Sri Lanka’s apparel sector.
| Article Code : | VBS/AT/20181127/Z_3 |