According to IFC documents, the proposed investment is a convertible preference shares (CPS) for up to PKR 4 billion (equivalent $25 million), at the Khaadi’s holding level (i.e. Khaadi Corporation SMC Pvt Ltd, “Khaadi” or the “company”). The new equity will help grow Khaadi’s retail operations by expanding and optimizing existing retail space, adding stores in strategic locations in tier II and III cities across Pakistan, accelerate global online sales and expand the international store network.The proceeds from the investment will be used to support store expansions in the next 5 years, fund working capital requirements and reduce short term debt. Khaadi’s retailing operations currently include the following:1) 62 retail stores/outlets in over 25 cities in Pakistan; the expansion plan is to double the number of stores nationally;2) One dining facility (KANTEEN / K-Kitchen) in Pakistan.
The plan is to reopen in due course and expand dining facilities in Pakistan;3) One warehouse in Karachi;4) “Art of Weaving” division with workshops that produces handwoven products for Khaadi’s retail stores;5) 14 retail stores in the United Kingdom, United Arab Emirates, Qatar and Bahrain. Current expansion plan is to maintain 15% of the business outside of Pakistan.
The total project cost is estimated at approximately US$25 million. The proposed IFC investment includes a quasi-equity investment via convertible preference shares for up to US$25 million for IFC’s own account.
Khaadi Corporation (SMC-Private) Limited
Chief Strategy Officer
22nd Floor, Sky Tower B, East Wing, Dolmen City, HC#3 Marine Drive, Clifton, Karachi - 74000, Pakistan
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