Future Consumer Enterprise Ltd (FCEL), the food and FMCG arm of Kishore Biyani-led Future Group, has acquired convenience stores chain Nilgiri’s run by The Nilgiri Dairy Farm Pvt Ltd in south India for an undisclosed amount, it said on Friday.
It has acquired 97.97 per cent stake of The Nilgiri Dairy Farm and its subsidiary companies as part of the transaction.
The Nilgiri Dairy Farm is directly, and through its subsidiaries, engaged in the business of licensing franchisee rights to third parties for operating convenience stores under the Nilgiri’s brand, manufactures food, grocery, chocolates, dairy and other products and is involved in trading in general merchandise and imported products. It also owns a portfolio of brands in these products.
It was founded way back in 1905 by Mudaliar family. In 2005 private equity firm Actis picked a majority stake in the company in one of the rare buyouts in India, back then. It is estimated to have put around Rs 300 crore or more in the firm.
Although the latest deal value was not disclosed as per media reports it is pegged at Rs 300 crore, which means Actis exited at-par or at a loss. Early this year it exited Dalmia Bharat with a haircut.
An email sent to Actis spokesperson for comments did not immediately elicit a response.
Nilgiri’s has 1,405 outlets spread across Kerala, Karnataka, Andhra Pradesh and Tamil Nadu and FCEL gets to expand geographically by increasing its footprint of convenience stores in south India with this transaction. Currently, the firm is concentrated in north and west India.
Nilgiri’s branded bakery and dairy products will also be channelised across Future Group’s existing channels including Big Bazaar, Foodhall and Aadhaar. Similarly, FCEL’s existing brands like Sunkist, Tasty Treat, Golden Harvest etc will be channelised through Nilgiri’s store network.
“FCEL’s acquisition of Nilgiris, a leading food and grocery convenience store chain in South India having a unique portfolio of food brands supported by its own manufacturing facilities for dairy and bakery, is another step towards building a robust convenience stores through franchises in an asset light model as well as brings in new manufacturing capabilities and brands within the company,” said Kishore Biyani, CEO of Future Group.
FCEL (formerly known as Future Ventures) is a part of Future Group that operates modern retail networks in 102 cities and 40 rural locations though its various retail brands.
Besides its food product brands FCEL also houses KB’s Fairprice and Big Apple, convenience and supermarket chains besides Aadhaar, a rural wholesale distribution unit. It is also into food parks business.
(Edited by Joby Puthuparampil Johnson)