India’s Arvind Limited is in advanced discussions to acquire a majority stake in US-based Dalco Nonwovens for an estimated $125–140 million, in a move that underscores the accelerating global realignment of textile and industrial supply chains.
According to people familiar with the matter, the proposed deal is being led through Arvind’s technical textiles arm, Arvind Advanced Materials, and would mark the company’s first major manufacturing investment in the United States.
The transaction, if completed, is expected to provide the Indian group with a strategic local production base at a time when US buyers are increasingly shifting sourcing away from China due to persistent tariff pressures and geopolitical uncertainties.
Dalco Nonwovens, headquartered in Conover, North Carolina, specializes in needlepunch nonwoven fabrics widely used across automotive interiors, geotextiles, home furnishings, and industrial applications.
The company is currently owned by Snow Peak Capital, which acquired the business in 2022 as part of a broader platform investment in specialty nonwovens. Sources said the firm is now exploring an exit, with Lincoln International acting as the sell-side advisor.
The potential acquisition comes amid a broader “China+1” sourcing strategy being adopted by Western manufacturers, particularly in the automotive and industrial sectors. By establishing a manufacturing footprint in the United States, Arvind could bypass import duties and logistics bottlenecks that have historically affected exports from Asia, allowing it to serve Tier 1 and Tier 2 customers more competitively.
Industry analysts say such a move aligns with a growing trend among Indian textile players seeking to move up the value chain and expand into technical textiles, a segment that offers higher margins and long-term demand stability compared to traditional apparel fabrics. Nonwovens, in particular, have seen rising demand due to their applications in automotive lightweighting, infrastructure development, and filtration technologies.
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However, the deal also presents financial challenges. Arvind ended the fourth quarter of FY25 with cash reserves of around ₹827 crore (approximately $98 million), which is below the expected deal size. As a result, the acquisition is likely to be financed through a mix of internal accruals and offshore debt instruments, potentially including external commercial borrowings or structured acquisition financing.
Despite this, the company appears to have sufficient leverage capacity. Its consolidated debt-to-equity ratio stands at 0.42, indicating room for additional borrowing. For FY25, Arvind reported free cash flow of ₹760 crore and EBITDA of ₹919 crore, reflecting stable operating performance. Its advanced materials division contributed ₹1,544 crore in revenue and ₹234 crore in EBITDA, maintaining margins close to 15%, which could support future debt servicing.
Market observers note that this acquisition, if finalized at the upper end of the valuation range, would rank among Arvind’s largest overseas deals to date. More importantly, it would signal a strategic pivot toward high-performance textiles and global manufacturing integration.
Dalco’s established presence in the US market could also provide Arvind with immediate access to a diversified customer base, including automotive OEM suppliers, industrial converters, and infrastructure-related buyers. This would reduce customer acquisition time and strengthen Arvind’s positioning in advanced materials.
The deal reflects a wider transformation underway in the global textile and industrial fabric landscape, where proximity to end markets, supply chain resilience, and technical specialization are becoming critical competitive factors. For Indian manufacturers, overseas acquisitions are increasingly seen as a pathway to de-risk export dependence while capturing higher-value segments.
Neither Arvind Limited nor Dalco Nonwovens has officially commented on the ongoing discussions. The timeline for closing the deal remains unclear, and it is subject to due diligence, regulatory approvals, and final agreement on valuation and financing structure.
If completed, the acquisition would not only expand Arvind’s international footprint but also reinforce India’s growing role in the global technical textiles sector, as companies look to position themselves closer to key markets while navigating an evolving trade environment.
