TEXTILE firm S Kumars is learnt to be in advanced stage of negotiations to acquire a UKbased fashion outfit. The company, said a source, is controlled by NRIs. The company supplies a range of clothing and accessories for men, women and kids to high street retailers. It also offers a range of services from design to manufacturing and distribution. S Kumars managing director Nitin Kasliwal told ET that his company is interested in having a presence abroad in the textile distribution and retailing segment, but declined to give out details. People close to the development, however, said S Kumars planned to acquire the UK company in order to strengthen its back-end operation that would enable it to increase its share in the domestic as well as export market. The UK-headquarted over 26-yearold fashion firm has sourcing offices in China, Hong Kong and Bangladesh. The UK company’s competency lies in sourcing, designing and warehousing fabrics and ready to made clothes. This, sources say, would fit into the Indian textile company’s plan to enhance focus on the domestic luxury segment. S Kumars has had long negotiations with the US-based sourcing company American Pacific for a year now but the deal is yet to be concluded, said a source. Meanwhile, S Kumars has decided to de-merge Reid & Taylor division of the company, comprising luxury textiles and ready-to-wear garment. “The aim is to have increased focus on high margin luxury business,” said Mr Kasliwal. The company recorded a margin of 38-40% on Reid & Taylor last year. S Kumars plans to sell 10-20% of its stake in the subsidiary to raise Rs 600-700 crore, Mr Kasliwal said. The subsidiary may subsequently go for an IPO. The Reid & Taylor division is likely to clock a revenue of Rs 410 crore this year. The contribution of exports to S Kumars’s revenue was hardly 3% last fiscal, but the company would like to scale this up. An acquisition of a foreign sourcing chain can give S Kumars enough marketing muscle and a foothold in the high-end UK market. Indian textile makers have, of late, been quite aggressive at acquiring brands, retail, wholesale or manufacturing facilities abroad. Leading terry towel maker Welspun acquired UK premium towel brand Christy for Rs 132.6 crore last year. Another firm, Himatsingka Seide, acquired three companies abroad this year—US-based DWI Holdings, Giuseppe Bellora and Divatex Home Fashions. The acquisition brought Himatsingka large distribution networks in the home textile space. DWI has the licences for the sourcing, marketing and distribution of luxury home textile brands — Calvin Klein, Barbara Barry and Royal Sateen. Similarly, House of Pearl Fashions, which already has warehousing and sourcing facilities in the overseas markets, is looking to acquire a frontend retail chain in the US. Spentex Industries has also acquired yarn making facilities in Czech Republic and Uzbekistan