Future Group may acquire retail biz of Heritage Foods
Advertisement

Future Group may acquire retail biz of Heritage Foods

By Debjyoti Roy

  • 19 Sep 2016
Future Group may acquire retail biz of Heritage Foods
Kishore-Biyani.jpg

Kishore Biyani-led Future Group is in advanced discussions to acquire the retail business of Hyderabad-based Heritage Foods Ltd, in what would be the retail major’s second big acquisition in southern India in two years.

The Economic Times reported, citing people aware of the development it didn’t name, that Future Group will get more than 100 grocery outlets in Hyderabad, Chennai and Bengaluru if the planned acquisition goes through.

The deal may involve a share swap, besides a cash component, the report said.

Advertisement

Email queries to Future Group and Heritage Foods didn't elicit any response by the time of filing this article.

Mumbai-listed Heritage Foods, owned by family members of Andhra Pradesh chief minister N Chandrababu Naidu, has five business verticals—dairy, retail, agriculture, bakery and renewable energy.

The retail division operated 112 Heritage Fresh stores as of June end and posted a pre-tax loss of Rs 13.8 crore on revenue of about Rs 583 crore for the year through March 2016, according to the company’s stock-exchange filings. Shares of Heritage Foods touched their highest level in at least a year on Friday of Rs 840.75 apiece, more than doubling from a one-year low of Rs 368 in September 2015.

Advertisement

In May, Heritage Foods acquired the assets of Teja Dairy in Raichur district of Karnataka. It invested Rs 60 lakh to acquire the assets that include a dairy plant with a processing capacity of 20,000 litres per day.

Future Group, the second-biggest brick-and-mortar retailer after billionaire Mukesh Ambani-led Reliance Retail Ltd, operates hypermarket chain Big Bazaar, supermarket chain Food Bazaar and electronics store eZone, among others. It had earlier acquired Big Apple, Nilgiri’s and Bharti Retail. It had purchased Nilgiri’s, a south India-based chain, in November 2014.

Last month, the company was reported to be in talks to acquire Aditya Birla Retail Ltd’s megamarket brand ‘More’ in a bid to consolidate its dominance in the offline retail space.

Advertisement

The company claims to be operating over 700 retail stores in around 200 cities across the country. The group also operates its own online shopping ventures such as Bigbazaardirect.com and futurebazaar.com but has limited presence in India’s overall e-commerce industry.

Biyani, who had accused e-tailers of predatory pricing backed with foreign funding, recently made his first acquisition in the e-commerce space by acquiring Rocket Internet-backed online furniture and home furnishings store FabFurnish.com in an all-cash deal.

Like this report? Sign up for our daily newsletter to get our top reports.

Advertisement

Share article on

Advertisement
Advertisement
Google News Icon

Google News

Follow VCCircle on Google News for the latest updates on Business and Startup News