Talks between Indian Rayon and Tommy Hilfiger for a strategic alliance, first reported in the media on June 22, have broken down.

The companies were unable to agree on royalty payments or on the territories to be covered by the agreement. The original plan was for Indian Rayon's Madura Garments division to manufacture and market the US brand in India. Indian Rayon is already a major supplier to Tommy Hilfiger.

Meanwhile, Madura is growing on the back of its licensed brands Allen Solly (global except for the US), Peter England (global except for the UK and Ireland) and Louis Phillipe (global). In addition, IR also owns Elements, San Frisco, Byford (knitwear), and Van Heusen.

The premium garments market in India is estimated at Rs1200 crore, of which Madura owns 25 per cent, and the mid-priced market is estimated at Rs4800 crore, of which Madura claims to have 15 per cent.

By Navroz Havewala

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