SANTISTA TEXTIL PREPARES TO JOIN THE WORLD’S LARGEST CONCENTRATION OF DENIM AND JEANSWEAR PRODUCERS -- MEXICO
Background
Santista Textil is one of the world leaders in denim manufacturing. It has already acquired businesses in Chile and Argentina.
Mexico has become one of the largest centers in the world for denim fabric production and jeanswear manufacturing as a result of the shift by many US brand leaders of many of their production facilities to Mexico.
The Santista Board has stated it intends to own a denim mill in Mexico.
Search for the Best Entry Strategy
Intrix has worked with Santista Textil management to map out the trends and developments in denim production in Mexico and then to identify and profile the existing denim producers. There is a wide range of companies with different characteristics including:
Manufacturing commodity or specialty denim constructions;
Sales under own label or only to OEM's;
Sales to domestic and export oriented jeanswear companies;
Integrated products of denim and jeanswear or denim only.
The key objectives of this analysis were to match companies with Santista's requirements in terms of market position, production capability, product quality, business reputation and corporate culture.
The Results
Santista now has a detailed understanding of each of the companies who may be potential partners or future competitors. These profiles are being used to pursue negotiations and to develop strategies that will be effective competitively including:
Whether to pursue a joint venture or an acquisition;
The product range and profile to introduce in Mexico;
The management team and personnel requirements;
The production technical facilities and equipment required.
Commentary
This project is ongoing. It is part of Santista's overall worldwide strategy. The company has successfully integrated its Chilean and Argentinean acquisitions into a regional strategy. This gives a high level of confidence in successfully concluding and integrating an acquisition in Mexico.
