Looking at an interesting relational ship through this tie-up with Shopper's Stop as a group and Raheja family, said Kishore Biyani of Future Group.
Kishore Biyani's Future Retail will acquire Shoppers Stop's loss-making retail chain HyperCity for Rs 655 crore in a part cash and part stock deal. The deal, which is likely to be completed in the next three to five months, will see HyperCity Retail India Limited become a wholly-owned subsidiary of Future Retail.
Throwing more light on the rationale behind this deal, Kishore Biyani of Future Group said besides it adding 19 more stores, it will also bring out brands into the fold. It will help the company's ambition of adding 25-35 Big Bazaars every year.
He said they are keen to start FBB under HyperCity.
According to Govind Shrikhande of Shoppers Stop it is a win-win situation for both the groups. It will help Big Bazaar take its food business to another level and also help HyperCity realise profitability faster.
He also said that Indian food business and retail requires some amount of consolidation and this deal paves way for that consolidation, as well as gives HyperCity the leverage to participate in the big growth that Big Bazaar is planning.
Agreeing that it is a win-win situation for both, Biyani said looking at an interesting relational ship through this tie-up with Shopper's Stop as a group and Raheja family. It will not only more value to the business but make it more EBITDA accretive. HyperCity is store level EBITDA positive currently.For the full interview, watch video