Future Group sells 8.7% stake in Pantaloon Fashion Retail for $21M

Future Group has sold over half of its remaining stake in Pantaloon Fashion & Retail Ltd through a secondary market transaction on Thursday for Rs 134 crore ($21 million). Stock exchange data shows the shares were acquired by a couple of mutual funds.

Three years ago Future Group had spun out its apparel retail business from its flagship company Pantaloon Retail (now Future Retail) as a separate listed firm and sold a majority stake in the venture to Aditya Birla Nuvo, one of the largest branded fashion apparel players in the country.

Pantaloons format business had 65 stores and 21 factory outlets across 35 cities covering total retail space of over 2 million sqft. The firm Pantaloon Fashion & Retail, now majority owned by Aditya Birla Group, is now among the top three large format fashion stores in the country and the top player in the women’s wear segment. It has scaled up its presence and as of March 22015 had 104 stores and 30 factory outlets in 49 cities.

As of March 31, 2015, Future Group held a little over 17 per cent stake in Pantaloon Fashion & Retail and has sold over half of this on Thursday.

This comes at a time when the Aditya Birla Group is consolidating its branded apparel business under Pantaloons Fashion & Retail which would then be renamed as Aditya Birla Fashion & Retail, creating India's top branded clothing company by revenues and number of sales outlets.

Currently, the business is housed under separate subsidiaries and business units of Aditya Birla Nuvo Ltd, a diversified public listed firm of the group.

This is spread across branded apparel with the group's own brands such as Louis Philippe, Van Heusen, Peter England and Allen Solly (housed under Madura Fashion, a unit of ABNL); luxury branded apparel with international labels and retail outlets for Madura Fashion brands (part of Madura Lifestyle, a part of Madura Garments Lifestyle Retail Co Ltd, which is a subsidiary of ABNL) and a lifestyle department chain focused on apparel (Pantaloons Fashion and Retail, acquired from Future Group).

As part of the corporate rejig, it will bring all of this under Pantaloons Fashion and Retail. Madura Fashion and Madura Lifestyle together generated sales of Rs 3,645 crore with EBITDA of Rs 443 crore, while Pantaloons Fashion clocked revenues of Rs 1,801 crore with EBITDA of RS 62 crore for the 12 months ended December 31, 2014.

Madura Fashion and Madura Lifestyle have 1,735 exclusive outlets and over 6,000 additional points of sale as on March 31, 2015. Madura Fashion is the top menswear company in the country with Louis Philippe and Van Heusen as the two top selling brands in their category. Madura Lifestyle sells international labels under The Collective and Madura Fashion brands under the retail format Planet Fashion.

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