Debt-ridden Future Consumer Ltd on Tuesday announced the sale of its dairy business Nilgiri Dairy Farm to AVA Cholayil Healthcare for a total consideration of Rs 67 crore.
As per the deal, Future Consumer has entered into a "transfer agreement for the transfer of entire business undertaking of The Nilgiri Dairy Farm Pvt Ltd (NDFPL)".
This includes its franchisee operations, retail trade operations and the sourcing, processing, packaging and marketing of its dairy products, bakery products (except cookie plant), fast-moving consumer goods, staples and other products.
This monetisation will help Future Consumer Ltd (FCL), which is in the business of manufacturing, branding and distributing FMCG food and processed food products and committed several defaults towards principal and interest due on NCDs.
The board of the Future Group FMCG arm in a meeting held on Tuesday, approved the sale of NDFPL business to AVA Cholayil Healthcare, which is in the business of manufacturing, marketing & distributing personal care and food products and running a chain of wellness clinics and hospitals. The purchase consideration of Rs 67 crore shall be paid in three tranches on meeting certain conditions. The purchase consideration of Rs 67 crore shall be paid in three tranches on meeting certain conditions.
However, the deal will be "subject to obtaining of all necessary consents and approvals including that of the Lenders and Shareholders of the Company in accordance with applicable laws and regulations," it added.
NDFPL is engaged in the business of manufacturing, marketing and distribution of dairy products and bakery products and also in procuring various FMCG, staples etc for distribution and sale to certain retail outlets under its franchisees. Turnover of NDFPL was at Rs 39.65 crore constituting 10.40 per cent of the consolidated turnover of Future Consumer.
In 2014, FCL acquired NDFPL and its subsidiary Nilgiri's convenience store chain for around Rs 300 crore.
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