Aditya Birla Nuvo Ltd (ABNL), a listed entity of Aditya Birla group, is acquiring a 50-per cent controlling stake in Pantaloon Retail India Ltd's (PRIL) chain of fashion apparel and accessories, 'Pantaloon Format' business, post its demerger.
The Birla Group company, which is a business conglomerate with presence across manufacturing, financial services, telecom, fashion and lifestyle and information technology, will infuse Rs1,600 crore - Rs800 crore via debentures and assuming Rs800 crore in debt – to acquire the retailer, which operates under the brand name 'Pantaloon'.
The Aditya Birla group firm will also make an open offer for a minimum 26-per cent stake of the resulting entity, and post acquisition will hold a minimum of 50.01 per cent in the new company. The new company will become a subsidiary of ABNL, after the demerger.
''The proposed acquisition is in line with our strategic intent to be on the top of the league and to create the largest integrated branded fashion player in the country through an extension into the value segment. This acquisition will catapult ABNL to the pole position in the branded fashion space in all the segments with a pan India
presence,'' ABNL chairman Kumar Mangalam Birla said.
PRIL will demerge its Pantaloons Format business through a court scheme of arrangement. The transaction is expected to be completed within 8-10 months, subject to approvals, the companies said in two separate statements.
PRIL, controlled by Kishore Biyani, runs other businesses such as hypermarkets under the Big Bazaar brand, the E-zone electronics chain and Central, a lifestyle retailing firm.