Sri Lankan apparel manufacturer, Hela Clothing Group has secured a capital infusion of Rs. 1.2 billion by way of a mix of shareholder and new private equity investment funds from a private consortium whose lead investor has a wide portfolio including private equity investments in Fashion and Retail sectors.
A.R. Rasiah, the former Finance Director at Nestle Lanka PLC, former Senior Director of Nations Trust Bank PLC, former Chairman of Atlas Axillia (Pvt) Ltd and director of many other listed and non-listed entities, has been a long-standing Director of the Company and will now be Chairman of the Group.
Overwhelmed by the interest from private equity funds to invest in Hela, Rasiah together with the Company’s Board of Directors secured an anchor partner with a wealth of retail and supply chain expertise.
“The focus for the past twelve months was to right-size the business and drive free cash flow generation through operational excellence, and prudent cost management together with customer and supply chain optimisation strategy.
With the business now having made significant progress in those areas the focus is now around Balance Sheet strengthening both through raising equity and building cash reserves through operations,” said Rasiah. Hela plans to use this capital infusion on several fronts. The majority of the proceeds will be used to repay debt and replenish working capital thus, strengthening the Company’s Balance Sheet.
The balance funds will be used to fuel growth by enhancing and expanding its manufacturing footprint in Africa and for further operational streamlining, beginning with the group-wide ERP system being upgraded in partnership with SAP solutions.