26 May 2016 Current Affairs: Aditya Birla Fashion and Retail, part of Aditya Birla Group, has acquired the rights for global fashion chain Forever 21 in the country for an undisclosed sum.
Forever 21 had a three year old tie up with DLF Brands and wanted to exit the partnership for a much aggressive play in the country, said sources. Myntra was also in talks to buy the rights of Forever 21.
Aditya Birla Fashion has signed a memorandum of understanding (MoU) with the US based Forever 21 to acquire its exclusive online and offline rights for Indian market and its existing store network in India from the current franchisee Diana Retail, the company said on Wednesday in a release.
The proposed acquisition is in line with our strategic intent to create the largest integrated branded fashion player in the country. With the acquisition of Forever 21 India business, we aim to create a strong foothold in the womenswear business in the western wear segment. Currently, the western womenswear segment is growing at more than 20 per cent. The proposed acquisition will further strengthen leadership position of ABFRL in the branded fashion space.
Forever 21 entered the country in 2010 through a Middle East-based group Sharaf Retail, but could not scale up. In 2013, it forged a partnership with DLF Brands to open 40-50 stores in five years in the country, but could not open stores as planned.
Forever 21 has built a very strong franchise in India in the last few years and has already become a brand of choice for fashion conscious women. The young demographics of the country and emergence of fast fashion segment offers opportunity for rapid growth for the brand. The partnership of Forever 21 and ABFRL will help establish Forever 21 as one of the largest womenswear brand in the country.
Founded in 1984, Forever 21 operates more than 730 stores in 48 countries with retailers in the United States, Australia, Brazil, Canada, China, France, Germany and others. Forever 21 has brands like Forever 21, XXI Forever, Love 21 and Heritage in its portfolio.