Retail chain major Shoppers Stop plans to raise Rs250 crore to raise stake in its hypermarket chain, Hypercity, a top company official said today.
"We have an option to increase our stake in Hypercity from the present 19% to 51% by June 2010, for Rs250 crore. The proceeds would be raised through a rights issue and warrants," Shoppers Stop president and CEO Govind Shrikhande said on the sidelines of a conference here.
The decision for the rights issue and warrants will be take after the postal ballot results on December 15, he said.
The price of warrants to promoters has been fixed at Rs308, while the company will decide on pricing of the rights issue in the next few days, Shrikhande said.
Shoppers Stop proposes to invest Rs200 crore for expansion over the next three years.
"We have drawn up investment plans of Rs200 crore for adding 18 new stores with about 3 million sq ft in the next three years. The stores will be opened at Ahmedabad, Amritsar, Mangalore, Mysore, Aurangabad, Chandigarh and other tier-II cities," Shrikhande said.
Shoppers Stop is India's largest retail chain of large-format department stores, with 28 outlets in 12 cities occupying an aggregate area of over 1.88 million sq ft.
Meanwhile, the company launched European denim brand `Mustang' here today. Mustang apparel is tagged at an attractive price with men's shirts starting at Rs599 and men's bottom wear starting at Rs1,599.
Similarly, women tops are priced at Rs599 onwards and bottom wear from Rs1,399.
The company plans to launch more foreign brands in the near future, Shrikhande said, adding the affordable foreign brands have good scope in India.
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