Twitter
Advertisement

Future Retail to buy retail, allied biz of Heritage Foods

Heritage Foods is promoted by the family of Andhra Pradesh chief minister N Chandrababu Naidu

Latest News
article-main
FacebookTwitterWhatsappLinkedin

Future Retail Ltd said on Monday that its Board of Directors has approved the acquisition of retail and allied businesses of Heritage Foods Ltd (HFL).

HFL is promoted by the family of Andhra Pradesh chief minister N Chandrababu Naidu.

While there is no cash involved in the transaction, the enterprise value of this deal is estimated at Rs 295 crore. The acquisition is being done on a slump sale basis and is expected to be completed in another six to eight months.

The retail and allied business of Heritage Foods had a net worth of Rs 109.68 crore as on March 31, 2016, while its turnover during the last financial year i.e. FY16 was Rs 629.70 crore. The retail business of Heritage Foods currently runs a chain of 124 stores in three southern cities of Hyderabad, Bengaluru and Chennai.

“On closure of the transaction, Heritage Foods will own 3.65% of shares in Future Retail Ltd through a fresh issuance of shares by the company,” Kishore Biyani-led Future Group said in a statement.

As part of the scheme of arrangement for the acquisition, Heritage Foods will spin off its retail, bakery, agri-sourcing and veterinary care businesses to a fully-owned subsidiary.

Subsequently, all these businesses except veterinary care will then be merged with Future Retail. Heritage stores have emerged among the most popular retail brands in Southern India, serving over 24 million customers annually.

With store sizes ranging 2,000 square feet to 8,000 sq ft, these small-format stores are located within key neighbourhoods of Hyderabad, Bangalore and Chennai and complement well with Future Retail’s existing network of 379 small-format EasyDay stores.

Find your daily dose of news & explainers in your WhatsApp. Stay updated, Stay informed-  Follow DNA on WhatsApp.
Advertisement

Live tv

Advertisement
Advertisement