Arvind, Hammerle Plan For Link-Up Comes A Cropper

The proposed collaboration between Arvind Mills, the Sanjay Lalbhai flagship company, and Hammerle of Austria, for a premium shirting project, has fallen through. The two textile majors had fallen out over issues relating to the proposed project's technology, marketing and distribution network.

Speaking to Business Standard, Ajit Mantagani, president, (corporate planning) Arvind Mills said, The joint project between Arvind Mills and Hammerle had to be dropped since we failed to reach a common approach on various issues".

According to him, a consensus could not be arrived at on the kind of fabric to be manufactured, the global marketing strategy and technology for the proposed project.

 

The plant, which had an estimated investment of Rs 350 crore, was to be located at Santhej near Ahmedabad. It had a installed capacity of 18 million metres of shirting fabric per annum.

Besides providing technical assistance, the Austrian firm was also involved in the marketing and distribution division of the proposed project. The Indian company is now scouting for a new partner for the project. Mantagani said Arvind Mills may opt to be on its own" in this project instead of a collaboration with any foreign company. In the new plan, Arvind Mills might buy separate technologies for various units in the plant like design, processing and dyeing from different companies.

The shirting plant is one of the greenfield projects which is coming up at the 600 acre industrial complex of Arvind Mills near Ahmedabad. The estimated investment of the complex is over Rs 800 crore. The other greenfield projects in the complex include the Swiss voile project and a knitwear project. The Swiss voile project is a joint venture between Arvind Mills and Deitfurt, a division of Oerlikon, the multi-disciplinary engineering major of Switzerland. Besides picking up 50 per cent equity in the Rs 150-crore project, Deitfurt will also supply technology and marketing support to the project.

The knitwear project is in collaboration with US-based Alamac, a division of the $1.8-billion West Point Stevens group. The Rs 100-crore plant would produce 10 tonnes of knitwear daily in the first phase of operations. The two other joint ventures of Arvind namely Lee and Arrow would source their fabrics from Arvind-Alamac for their range of knitwear readymades to be shortly launched in the country.

Another project for bed and bathroom linens is being planned with the same group. However, project details are yet to be divulged by the company.