The Indian company engaged in the manufacturing and export of bed linen, fashion, utility, and institutional bedding has made a strategic move to expand its operations by acquiring Modern Home Textiles, Inc., a Delaware-based utility bedding manufacturer. The acquisition, valued at USD 11.7 million, is set to be completed by October 31, 2024, and will bring the company a 100% stake in the US-based firm.

Modern Home Textiles, Inc. is headquartered in Phoenix, Arizona, and specializes in the production of pillows and other utility bedding products. With an annual production capacity of 8 million pillows, this acquisition is expected to significantly boost the Indian company’s presence in the North American market.

Why This Acquisition Matters:

The Indian bedding company has been a key player in the manufacturing of bed linen and related products in India, and this acquisition of Modern Home Textiles, Inc. marks a significant step in its international expansion efforts. The acquisition will enable the company to increase its production capacity, cater to a broader customer base in the North American utility bedding segment, and expand its market share in a rapidly growing industry.

This move aligns with the company’s strategy to diversify its product offerings and strengthen its position in the global utility bedding market. By incorporating Modern Home Textiles' products, the Indian company will be better equipped to meet growing demand in the US market and improve its competitive edge.

Financial Details:

The acquisition deal is structured as a cash consideration of USD 11.7 million, which includes an inventory valuation of USD 2.11 million. The final price is subject to adjustments for working capital and post-closing due diligence.

Industry Impact:

Modern Home Textiles, Inc. operates within the utility bedding industry, which is witnessing steady growth due to increased consumer demand for quality home textiles. The acquisition allows the Indian company to leverage this growth by establishing a stronger foothold in the North American market, which is a key region for the bedding industry.

This acquisition will not only increase the company’s market share but will also enhance its manufacturing capabilities. By acquiring a US-based facility, the company can streamline production processes, reduce shipping times for North American customers, and cater to local market needs more efficiently.

No Related Party Transactions:

It’s important to note that the acquisition of Modern Home Textiles, Inc. does not involve any related party transactions. The company’s promoters or promoter group have no interest in the entity being acquired, and the deal has been made on an arms-length basis.

Acquisition Timeline:

The acquisition is expected to be completed by October 31, 2024, after which the Indian company will assume full control of Modern Home Textiles, Inc. and its operations.

Strategic Objectives:

The acquisition of Modern Home Textiles will help the company achieve the following objectives:

  * Expand product portfolio: The addition of utility bedding products will complement the company’s existing offerings in fashion, bed linen, and institutional bedding, enabling it to cater to a wider range of customers.

  * Increase market share: The acquisition will provide a solid base for expanding the company’s market presence in North America, helping it to capture a larger share of the bedding industry in the region.

  * Strengthen international operations: With a manufacturing facility in the US, the company will have the advantage of producing goods closer to its target market, thereby reducing lead times and improving customer satisfaction.

Governmental Approvals:

No specific governmental or regulatory approvals are required for this acquisition, streamlining the process and allowing the company to focus on integration and expansion efforts post-acquisition.

This acquisition further reinforces the company’s commitment to growing its international footprint and enhancing its product offerings to meet the evolving demands of the utility bedding market.

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