The board of Kishore Biyani-owned Future Retail on Monday approved the acquisition of retail and allied businesses of Heritage Foods Ltd. promoted by the family of Andhra Pradesh Chief Minister Chandrababu Naidu.
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, Heritage Foods Retail Ltd. Subsequently, all these businesses except veterinary care will then be merged with Future Retail Ltd., the company said in a stock exchange filing.
Future Retail will transfer 1.78 crore fresh equity shares or 3.65 percent stake in the company – valued at Rs 295 crore – which will be held by Heritage Foods' retail shareholders.
The transaction is expected to be completed in the next six to eight months and is subject to necessary approvals.
The retail and allied division of Heritage Foods revenue stood at Rs 629.70 crore in financial year 2015-16, according to the stock exchange filing.
The retail business of Heritage Foods started operations in 2006 and runs stores under the brand name ‘Heritage Fresh'. Heritage Fresh is present across 124 outlets across Hyderabad, Bangalore and Chennai.
Heritage Foods also has integrated agri pack houses in Andhra Pradesh and Telangana which is its fruits and vegetable supply chain, and a bakery facility in Hyderabad which markets baked products through its retail stores and also supplies to quick service restaurants.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
