American & Efird (A&E), the largest U.S. manufacturer and distributor of thread and technical textiles, to increase its stake in Vardhman Yarns and Threads Limited, Indiaâ€™s second-largest manufacturer and distributor of industrial and consumer sewing thread, from its joint-venture partner, Vardhman Textiles to expand its production base.
The deal is expected to close this summer, after which A&E will own 89 percent of the business leaving Vardhman Textiles with the remaining 11 percent, marking the 125-year-old companyâ€™s fifth acquisition under KPS ownership. A&E has nearly doubled in size over the past four years.
Les Miller, chief executive officer of A&E, said that their long-standing blue-chip customer base, including leading global brands, multinational corporations and regional manufacturers, rely on A&E as a mission-critical supply chain partner. This acquisition further enhances their demonstrated ability to provide customers with the highest-quality thread and superior service around the world.
Vardhman Yarns and Threadsâ€™ excellent reputation, world-class operations and leading position in the Indian market will enable A&E to more fully benefit from both fast-growing domestic demand for high-quality products in India and increasing international demand for exports from India.
Vardhman Yarns and Threads, which generated revenue of about $110 million in fiscal year 2015-16, operates five manufacturing facilities in India and employs more than 4,500 associates. Financial terms of the deal were not disclosed, but Miller said that A&E plans to invest significant capital and resources in the company.
Vardhman Textileâ€™s decision to sell a majority stake comes as the company wants to focus on consolidating and strengthening its core business of yarn and fabric by way of having significant market share in Asian countries.
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