Pearl Global Industries Limited announces acquisition of 55% stake in Pearl GT Holdco Ltd

Pearl Global Industries Limited (PGIL), one of India's largest garment exporters has announced its strategic expansion into Guatemala, recognizing the unparalleled opportunities offered by the country's unique competitive position. The company has acquired a 55% stake in Pearl GT Holdco Ltd for a consideration of USD 550,000. The acquisition will be funded through internal accruals.

Pearl GT Holdco Ltd. is incorporated as the holding Company of Shoretex Sociedad Anonima (Shoretex), and Corporacion de Productos y Servicios Asociados, Sociedad Anonima (Corpasa).

Shoretex and Corpasa is incorporated in Guatemala and is engaged in the business of Manufacturing and Trading in Garments. By way of this acquisition, the Company is exploring near shore manufacturing opportunities in the Central America region. This strategic initiative aims to add value to the Company's growth by diversifying its manufacturing capabilities and expanding its geographical reach. This move enables PGIL to further strengthen its presence in three of the four major sourcing bases, catering to the evolving needs of its customers.

The companies are currently owned by Guatemalan residents and are generating an annual revenue of US$ 3.8 Mn operating across 3 lines.

The companies have a net worth of USD 1,068,552.

Post the acquisition, Pearl GT Holdco Ltd shall incur a capex of up to USD 2,000,000 in the subsidiary to expand capacities across 12 lines which shall generate an annual revenue of US$ 20 Mn.

Commenting on the above, Group Vice Chairman, Mr. Pulkit Seth said: "We are excited to announce our acquisition of a 55% stake in Pearl GT Holdco Ltd, signalling our commitment to diversifying our manufacturing capabilities and expanding our reach. This strategic move allows a paradigm-shifting opportunity that presents unique competitive advantages for our company. The acquisition of a 55% stake in Pearl GT Holdco Ltd is a significant step forward in our growth strategy. By entering the Central America region, we are seizing near shore manufacturing opportunities that align with our customers' needs, particularly in the post-pandemic era.

The COVID-19 pandemic has exposed the vulnerabilities of longer transit countries as sourcing bases, prompting us to prioritize near shore capabilities that emphasize speed and inventory control. With its stable business environment and membership in the Central America Free Trade Agreement (CAFTA) allowing us to tap into duty-free benefits, Guatemala stands out as the most stable environment in the near shore region.

Having a presence in three out of the four major sourcing bases enhances our ability to meet and exceed our customers' needs. We are committed to leveraging Guatemala's strengths and delivering comprehensive solutions that address the evolving demands of our valued clients."

Shares of Pearl Global Industries Limited was last trading in BSE at Rs. 544.00 as compared to the previous close of Rs. 535.30. The total number of shares traded during the day was 1793 in over 132 trades.

The stock hit an intraday high of Rs. 554.00 and intraday low of 529.55. The net turnover during the day was Rs. 969235.00.

Source : Equity Bulls

Keywords

PearlGlobalIndustries INE940H01014 Acquisition PearlGTHoldco