Aditya Birla Fash­ion Aims to Stitch a Pact with Amer­i­can Ea­gle

Co in talks with US brand; move part of its ag­gres­sive push to form part­ner­ships with for­eign play­ers to com­pete in In­dia’s fash­ion mar­ket

The Economic Times - - Brands: Creating Desire - Ra­sul.Bailay@ times­group.com

New Delhi: Aditya Birla Fash­ion & Re­tail is in an ad­vanced stage of talks with Amer­i­can Ea­gle Out­fit­ters to open stand­alone out­lets of the US fash­ion brand pop­u­lar with the youth, two peo­ple in the know of the mat­ter said.

The re­tail arm of the Aditya Birla Group is look­ing for the rights to sell the brand both of­fline and on­line in In­dia, one of the peo­ple said. NYSE-listed Amer­i­can Ea­gle op­er­ates around 1,000 stores in the US, Canada, Mex­ico, the UK, China, Ja­pan and sev­eral coun­tries in the Mid­dle East.

A spokesper­son for Aditya Birla Fash­ion said the com­pany does not com­ment on “mar­ket spec­u­la­tions”, while Amer­i­can Ea­gle did not re­spond to an email sent on Fri­day seek­ing com­ment.

In­ter­est­ingly, in 2015, the US firm had dragged Aditya Birla Fash­ion’s de­part­ment store chain, Pan­taloons, to the Delhi High Court al­leg­ing trade­mark in­fringe­ment by the In­dian com­pany.

The pe­ti­tion had ac­cused Pan­taloons of us­ing a brand name — Ur­ban Ea­gle — and logo that were de­cep­tively sim­i­lar to those of Amer­i­can Ea­gle. Talks with Amer­i­can Ea­gle are part of Aditya Birla Fash­ion’s ag­gres­sive push to form part­ner­ships with for­eign brands as it seeks to com­pete in In­dia’s chang­ing land­scapes in fash­ion and life­style.

Ac­cord­ing to var­i­ous in­dus­try sources, the fash­ion busi­ness of the Aditya Birla Group is un­der pres­sure from in­vestors to stitch to­gether a win­ning for­mula, re­flect­ing the lat­est trends in In­dia’s fash­ion scene that has been re­de­fined in re­cent years by brands such as Zara and Swedish fash­ion re­tailer H&M.

The Aditya Birla Group cre­ated Aditya Birla Fash­ion & Re­tail in May 2015 by merg­ing its units Madura Fash­ion, Pan­taloons Fash­ion & Re­tail and Madura Gar­ments Life­style Re­tail. The re­tail arm owns brands in­clud­ing Louis Philippe, Van Heusen, Allen Solly and Pan­taloons de­part­ment stores.

Mar­ket watch­ers said the pres­sure on Aditya Birla Fash­ion has grown since peer Arvind Brands, which sells global la­bels in­clud­ing Tommy Hil­figer, Calvin Klein, Gap, US Polo, Gant and Aero­postale in In­dia, raised .₹ 740 crore by sell­ing a 10% stake last year to Mul­ti­ples Pri­vate Eq­uity.

In a state­ment to ET in April, Aditya Birla Fash­ion said it was the “mar­ket leader” in In­dia’s branded ap­parel mar­ket, and that it has a “rich port­fo­lio of the largest and the most prof­itable brands in the coun­try”.

Aditya Birla Fash­ion has also tied up with New York-based de­part­ment chain Saks Fifth Av­enue and plans to roll out the Saks branded out­let, spread over 100,000 sq ft, at Ae­roc­ity near New Delhi’s in­ter­na­tional air­port.

COM­PANY PHOTO In 2015, the two cos were bat­tling a trade­mark in­fin­ge­ment case in In­dia

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