Biyani Sees a Future With FabFurnish
Future Group completes all-cash transaction to buy online furniture retailer
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)
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