The Malaysian government-linked private equity fund management company Ekuiti Nasional (Ekuinas) has acquired a 35 per cent stake in Malaysia’s Bumiputera sportswear retailer Al-Ikhsan Sports for RM68.6 million (US$16.8 million).
The deal includes full acquisition of the company’s sportswear brand Al Sports.
Branded sportswear retail sales in Malaysia are set to grow 8 per cent annually to reach RM2 billion by 2020, while in neighbouring countries such Indonesia, Singapore and Thailand are expected to grow past the RM13 billion mark in the same period, says Marketing magazine.
“The retail segment is one of Ekuinas’ six identified target sectors, and our entry into the sportswear segment gives us a wider reach within retail,” says Ekuinas chairman Raja Tan Sri Dato’ Seri Arshad Raja Tun Uda. Ekuinas already has investments in F&B.
He says one of the main factors supporting the acquisition is that via Al-Ikhsan, Ekuinas has a chance to back a “highly capable Bumiputera entrepreneur with a view to transform the business into a stronger market leader with regional presence”.
Established in 1993 by Tuan Haji Ali Hassan Mohd Hassan, Al-Ikhsan has a 36 per cent market share in the multi-brand sports retail industry, encompassing equipment, apparel and footwear, with 119 outlets in peninsular Malaysia. Al-Ikhsan stocks 30 sporting brands including Adidas, Nike and Puma.
Al-Ikhsan recorded its highest revenue in 2012 at RM278 million. At end last year, its revenue was RM257 million.
CEO Syed Yasir Arafat Syed Abd Kadir says the company plans to expand into new markets.
Ekuinas will work with Al-Ikhsan’s founder and management team toward accelerating both local and regional expansion. There are plans to roll out four megastores in Kuala Lumpur and Perlis, followed by speciality stores in Kuala Lumpur and Penang.
Al-Ikhsan is also eyeing the Sabah and Sarawak markets with plans to open six stores in Kuching and Kota Kinabalu by 2018. Other Asean markets, namely Indonesia and Thailand, are also on the list.
Ekuinas has invested in 36 companies since being established in 2009.
