Biyani Sees a Fu­ture With FabFur­nish

Fu­ture Group com­pletes all-cash trans­ac­tion to buy on­line fur­ni­ture re­tailer

The Economic Times - - Disruption: -

Biswarup Gooptu & Ra­sul Bailay

New Delhi: Kishore Biyani-led Fu­ture Group has com­pleted its buy­out of FabFur­nish, as it looks to take on the threat posed by Swedish fur­ni­ture re­tail­ing giant Ikea, which is ex­pected to make its en­try next year, and in the process also mark­ing the first exit of Rocket In­ter­net in In­dia.

The all-cash trans­ac­tion will see Fu­ture Group bring its en­tire port­fo­lio of home fur­nish­ings and decor busi­ness un­der the FabFur­nish brand, mak­ing it the largest home fur­nish­ings and dé­cor busi­ness in the coun­try.

“Today I op­er­ate in only 20 cities (through Home Town). Now I can op­er­ate all over In­dia,” Biyani told ET.

He, how­ever, de­clined to dis­close the ex­act amount paid by Fu­ture Group to ac­quire the on­line fur­ni­ture re­tail ven­ture.

The move, ac­cord­ing to Biyani, will also act as bul­wark against Ikea, which is sched­uled to open its first store in the coun­try in 2017, and which has iden­ti­fied In­dia as one of its key growth mar­kets glob­ally.

“We are creat­ing the largest home fur­nish­ings com­pany in the coun­try. Ikea is com­ing in, and it will take them at least two to three years to be­come an .₹ 1,000-crore com­pany, and we are al­ready there,” he said.

Ac­cord­ing to Biyani, the new com­bined en­tity will look at achiev­ing Ebitda of .₹ 40 crore-.`50 crore in the cur­rent fis­cal.

While the en­tire FabFur­nish team has been re­tained for the time be­ing, Fu­ture Group se­nior ex­ec­u­tive Mahesh Shah and chief ex­ec­u­tive of Home Town, the home fur­nish­ings busi­ness owned by Fu­ture Re­tail, will head the new en­tity. The FabFur­nish team, ac­cord­ing to Biyani, will con­tinue to look af­ter the on­line re­tail part of the busi­ness.

The ac­qui­si­tion comes less than two months af­ter ET had re­ported that the Ber­lin-based in­cu­ba­tor and Fu­ture Group, the coun­try’s largest brick-and-mor­tar re­tail com­pany, had en­tered into ne­go­ti­a­tions, for the lat­ter to ac­quire FabFur­nish, an early player in on­line fur­ni­ture re­tail­ing seg­ment in In­dia, but which had not been able to with­stand com­pe­ti­tion from ri­vals, such as Pep­per­fry and Ur­ban Lad­der.

(Ad­di­tional re­port­ing by Payal Gan­guly in Ben­galuru)

Biyani: Sit­ting Pretty

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