Narula to sell Lilliput, allowing Bain and TPG to exit

This will see the Lilliput brand, its retail assets and liabilities transferred to a new company which will be sold off to a third party. Sanjeev Narula, founder of Lilliput, will be left with his original assets, a garment manufacturing and export business, The Economic Times reported

"The company can't service the debt any more; I have no option but sell '' Narula said.

Ever since Bain and TPG invested in Lilliput in 2010, the company has increased its debt exposure in order to finance expansion plans. It added 600,000 square feet of retail space in two years, equal to the total amount added over the previous eight years. Lilliput is thought to owe more than INR7 billion ($142 million).

The sale is expected to generate INR10-12 billion, offering an exit opportunity to Bain and TPG, which invested $60 million and $26 million in the brand.

Private equity players including the likes of KKR, Blackstone, L Capital and India Value Fund have reportedly signed non-disclosure agreements to enter into negotiations to purchase Lilliput. Mahindra & Mahindra, which operates mother and baby care business Mom & Me, has also expressed interest.

Bain and TPG fell out with Narula after receiving an anonymous tip-off that led them to question the company's audited financial statements. Narula obtained a court injunction that prevented Bain and TPG from selling their stakes or discussing the matter publicly. It was announced in October that the company was seeking an out-of-court settlement with its investors.

Amidst the controversy, Lilliput's planned INR8.5 billion IPO was shelved.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• South Asia
• Consumer
• Exits
• Bain Capital Asia
• TPG Capital
• KKR
• L Capital Asia
• The Blackstone Group
• India Value Fund Advisors
• Consumer
• India