PE firm L Capital to sell its stake in Fabindia

L Capital, the private equity firm of Louis Vuitton Moet Hennessy (LVMH), is planning to sell its stake in Fabindia Overseas. It hopes to get Rs 660 crores for the 8 percent holding in the company which is still unlisted. It had made the investment in 2012 from Woldfensohn Capital Partners for Rs 150 crores. The value of the company at that time was Rs 1,875 crores, now if L Capital gets the price it is looking for, the deal will value Fabindia at around Rs 8,200 crores. Four potential buyers have been contacted which are Temasek, Actis, Apax Partners and the Carlyle Group.

L Capital has invested in only one Indian company till now. The PE firm had considered investing in two other fashion houses but the deal didn’t go through. It had invested in Fabindia through its Asia Fund.

Fabindia, based in New Delhi, has more than 200 stores in 79 locations. Its present customer base of 3 million is expected to expand to 10 million in next 3-4 years. Arvind Singh, Chairman, Technopak Advisors, believes Fabindia is among the best retail businesses in the country. Abhishek Singhi, Senior Partner at The Boston Consulting Group says that the company has ‘successfully created a strong brand in a largely unorganised market and its sourcing network and loyalty base give it a competitive edge.’