Actis Group, which has acquired 100 percent stake in Vlisco Group, has pledged to protect the intellectual property rights of the company in a bid to beat competition from the influx of cheap textile imports from China.
Actis, an emerging market private equity firm, last week paid US$151 million to Vlisco Group - printers of GTP and Woodin fabrics - to assume a controlling stake in the textile manufacturing company.
The Head of Actis West Africa, Ngozi Edozien, told B&FT in a telephone interview on acquiring Vlisco Group that the new owners will leverage on its experience in emerging markets to shrug-off competition from cheap textile imports.
“The thing about the Chinese imports is that they infringe on intellectual property rights and we want to be a champion of intellectual properties. We will work on re-enforcing intellectual property rights.
“We know the market conditions in the West-African market very well and we will leverage on our experience in the market to provide market support to the company. And with that we will be able to do better than the previous owner,” she said.
Actis which invested the equity and raised the debt to finance a US$36 million Accra Mall project three years ago - currently has US$4.8bn funds under management with nine offices worldwide. In Africa, the company has over US$1.5bn funds under management in 17 countries and over 25 investment professionals located in Nigeria, South Africa, Egypt, Kenya and London.
The textile market has lately seen stiffer competition from Chinese imports, which threaten the survival of manufacturing firms on the continent. Ms. Edozien believes the acquisition of Vlisco Group is a good deal that will enhance shareholder value in Actis.
“Vlisco is a strong, branded textile industry. The key here is the brand and what Vlisco stands for; innovation and quality - and besides the traditional designs, we are going to bring on board new ones,” she added. She said the company will not change the Vlisco identity and will only bring on board operational support to the company in terms of strategy and expanding the brand.
“Brands like GTP that is steeped in Ghanaian cultural heritage offer up a fantastic opportunity, which is why we are focused on growth whilst fiercely protecting the quality that has earned these brands their reputation.”
She added that the new owners do not envisage undertaking any of the retrenchment exercises that have often accompanied business mergers and acquisitions, saying: “We don’t envisage retrenching any worker and we don’t see a change in the workforce.
“Employees will have a new good manager who is ready to work with them.”
Vlisco Group, a 164-year-old business, leads African design trends in printed and wax fashion fabrics. The Group has strong retail presence in a number of countries including Ghana, Democratic Republic of the Congo, Côte d’Ivoire, Togo and Benin.
The company boasts various brands ranging from premium (Vlisco), through mid-tier (Uniwax), to contemporary (GTP and Woodin).The company directly employs over 2,100 people of which 1,500 are located in West Africa, with over 490 employed in Tema. The Vlisco Group’s downstream supply chain indirectly employs many more, supporting entrepreneurialism among distributors, shopkeepers and tailors.
The representative of Vlisco Group in Ghana, Erik Van der Staaij, said: “We are convinced that given the experience, commitment and interest of Actis in Africa, this new venture will propel our GTP, Woodin and Vlisco brands to even greater heights of prosperity.
As a notable investor in modern retail facilities for Africa, like the Accra Mall, Actis’s buying into our well-established African textile and fashion business will help to fast-track our Ghanaian retail network ambitions.”
Source: Business and Financial Times
