FUTURE RETAIL ACQUIRES HYPERCITY FOR ₹655 CR

MUMBAI: Kishore Biyani-led Future Retail Ltd Thursday announced the ₹655-crore acquisition of HyperCity Retail India Ltd owned by K Raheja Corp.

Future Retail owns Big Bazaar, Easyday, Nilgiris and Heritage stores and online furniture store Fabfurnish.com, while HyperCity Retail, a subsidiary of Shoppers’ Stop Ltd, operates HyperCity large format stores.

The stock-and-cash deal will be completed in three to five months, Future Retail said in a stock exchange filing. Future Retail will allot 9.31 million shares to HyperCity Retail’s 15 shareholders at a ₹535 per share on a preferential basis. This means of the total deal value, ₹500 crore will come from these shares. The remaining ₹155 crore will be paid in cash, the company said in the filing.

Shares of Future Retail Ltd closed 0.81% up on the BSE on Thursday while those of Shoppers’ Stop closed 2.54% higher.

The deal is subject to approval of Shoppers’ Stop shareholders and the company will hold an extra-ordinary general meeting on 13 October for this purpose. Once the deal is completed, HyperCity Retail will become a wholly owned subsidiary of Future Retail Ltd.

Of the 15 shareholders of HyperCity Retail, five are individual investors, including the members of the Raheja family that own the company and its parent Shopper’s Stop.

As of March 31, HyperCity Retail had a net worth of ₹11.45 crore and annual sales of ₹1,191 crore. The firm made losses worth ₹84.73 crore and has debt worth ₹400 crore on its books as of March 31, 2017, data from the company’s annual reports show.