Reliance Brands will buy a 40% stake in the India operations of Italian toymaker Plastic Legno SPA

On June 1, Reliance Brands Limited (RBL), a subsidiary of Reliance Retail Ventures, announced that it had formed a joint venture with Plastic Legno SPA to purchase a 40% stake in the latter's toy-making company in India.

Reliance Brands stated in a stock exchange filing that the transaction will "strengthen the toy manufacturing environment in India." "RBL and Plastic Legno SPA have inked a joint venture agreement under which RBL will acquire a 40% stake in Plastic Legno SPA's toy manufacturing company in India," according to the press release.

"This investment by RBL serves a dual purpose," according to the release, "providing vertical integration for RBL's toy business while also helping diversify the supply chain with a long-term strategic interest in growing toy production in India."

By acquiring British toy shop Hamleys, RBL made its first overseas foray.

The Sunino company, a privately held group of firms based in Italy with over 25 years of experience in toy production in Europe, owns Plastic Legno SPA. The company began operating in India in 2009 "out of a need to build a robust production hub that would cater to worldwide markets," as well as because India was a rapidly changing and rising market.

"Keeping with our honourable prime minister's vision of Atmanirbhar India, this collaboration with Plastic Legno's deep experience in world-class toy manufacturing coupled with our strong footing in the global toy retail industry would open new doors and unparalleled opportunities for toys manufactured in India," an RBL spokesperson said of the joint venture. RBL must develop design-to-shelf capacity in order to gain a strategic advantage over the competition and to serve as a catalyst in the development of a robust toy manufacturing ecosystem in India, not only for domestic consumption but also for export."

"With its portfolio of Hamleys, the British toy shop, and indigenous toy brand Rowan, RBL has a strong play in the toy sector, making RBL one of the largest toy distributors," the spokesperson continued. Hamleys is the largest toy store chain in India, having 213 locations in 15 countries."

"We are really fortunate to have RBL as a partner in this joint venture," Paolo Sunino, Co-owner of Sunino Group, remarked. We are certain that Plastic Legno's toy-making experience and Hamley's commercial reach will complement one another, allowing the JV firm to reach new heights and achieve greater success. We have significant development plans to carry out, always with the goal of establishing a cultural background in this area of India. We are prepared for the challenges of the future, but with a partner like RBL by our side, we are confident that we can achieve great things."