Future Retail to buy HyperCity for Rs 655 cr

After brainstorming for over four hours, the Board of directors of Kishore Biyani-promoted Future Retail finalised the acquisition of K Raheja Corp owned hypermarket chain HyperCity Retail (India) Ltd (HRIL).

The entire equity share capital of HRIL, according to a Future Retail Ltd (FRL) statement, has been acquired from existing shareholders for part cash and part share consideration. The Board also approved the execution of a term sheet for the said deal aggregating to Rs 655 crore.

HyperCity Retail reported a turnover of Rs 1,191 crore for the fiscal 2016-17 while its net worth, as of March 2017, stood at Rs 11.45 crore. It currently operates 19 stores across the country with approximately 1.24 million square feet under operation.

“The acquisition would result in further consolidation FRL’s retail business while also increasing the company’s foothold in the hypermarket segment,” FRL said in a statement. The deal is expected to close in another three to five months.

As part of the arrangement to discharge part of the consideration, the board also approved to issue and allot in aggregate and up to 93,10,987 equity shares of Rs 2/- f, collectively to the sellers at a premium of Rs 535 per equity share.