Heritage Foods in talks with Future Group to sell its retail biz

Heritage Foods is in discussions with Future Group for a possible sale of its retail business, reports CNBC-TV18. While Heritage has confirmed they are in talks with Future for a possible business collaboration, it has said all discussions are currently exploratory in nature.

Heritage Foods has an array of businesses like dairy, retail and renewable energy. Under its retail business, the company operates nearly 110 grocery stores majorly in Southern India.

Although the retail business contributes roughly 25-30 percent to total revenue of Heritage, it has been loss-making at the earnings before interest, tax, depreciation and amortisation (EBITDA) level. Hiving off this business will, therefore, prove beneficial for the company.

For Future Group the deal means better geographical presence and addition of 110 stores to its nearly 800-store portfolio. In revenue terms, it will be only be a marginal addition of 5-6 percent.Watch video for more...