Italian Annabelle acquires sick TN leather unit
The venture, among others, is expected to reduce operating costs of the company.
By TNN |
CHENNAI: Italian shoemaker Annabelle has acquired an Ambur-based sick leather footwear unit, ushering the first foreign direct investment (FDI) in the formal gents footwear segment. The Italian company has bought over A S Nissar Ahmed and Co in the leather belt of Tamil Nadu for an estimated 800,000 euros (Rs 4.6 crore approximate). ''The deal, signed last week, is expected to add teeth to the growing FDI in the leather footwear segment in India,'' sources told ET.
Although a small beginning, this is the first such investment in the gents formal leather footwear segment, as all previous investments have been made in the sports footwear and the foot component sectors. The company will soon commence production to meet its global demands, they said.
The flow of investments, despite infrastructure bottlenecks, is an indication of the growing importance of India in the global leather industry. The venture, among others, is expected to reduce operating costs of the company.
Annabelle will significantly invest additional capital, besides bringing along technology to make world class footwear. Currently, A S Nissar and Co manufactures around 3,000 pairs a day. The Italian company is looking to scale up the production capacity to about 10,000 pairs a day, sources said.
The Italian shoemaker is sourcing 15,000 pairs of footwear and components, mainly leather shoe uppers and leather unit soles, from India and Bangladesh. Its manufacturing unit in the south of Italy produces close to 15,000 pairs a day.
According to a Council for Leather Exports report, global trade in leather footwear is worth $30 billion, while non-leather footwear is $18 billion. India's share is a mere 1.4% and 0.15% respectively.
''The recent decision by the European Union to impose anti-dumping duty of 16.5 % and 10% on footwear from China and Vietnam respectively is a boon to the Indian footwear industry. All major importers are looking at India to meet the global demand for footwear. At present, India caters to the $15-$20 segment while China and Vietnam caters to the $4-$8 segment in the global footwear market,'' sources added.
Although a small beginning, this is the first such investment in the gents formal leather footwear segment, as all previous investments have been made in the sports footwear and the foot component sectors. The company will soon commence production to meet its global demands, they said.
The flow of investments, despite infrastructure bottlenecks, is an indication of the growing importance of India in the global leather industry. The venture, among others, is expected to reduce operating costs of the company.
Annabelle will significantly invest additional capital, besides bringing along technology to make world class footwear. Currently, A S Nissar and Co manufactures around 3,000 pairs a day. The Italian company is looking to scale up the production capacity to about 10,000 pairs a day, sources said.
The Italian shoemaker is sourcing 15,000 pairs of footwear and components, mainly leather shoe uppers and leather unit soles, from India and Bangladesh. Its manufacturing unit in the south of Italy produces close to 15,000 pairs a day.
According to a Council for Leather Exports report, global trade in leather footwear is worth $30 billion, while non-leather footwear is $18 billion. India's share is a mere 1.4% and 0.15% respectively.
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''The recent decision by the European Union to impose anti-dumping duty of 16.5 % and 10% on footwear from China and Vietnam respectively is a boon to the Indian footwear industry. All major importers are looking at India to meet the global demand for footwear. At present, India caters to the $15-$20 segment while China and Vietnam caters to the $4-$8 segment in the global footwear market,'' sources added.
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