Kolkata: The RPG Group is planning to merge CESC with Pathik Retail, the holding company of Spencer's Retail.
Market sources said the merger implied that the group had abandoned the initial public offering plans (IPO) for the retail company.
The group was earlier considering IPO as one of the options for funding its aggressive retail plans. An investment of close to Rs1,000 - 1,200 crore had been earmarked for retail expansion throughout the country over the next two years.
Retail has been identified as one of the focus areas for the group and it expects 25-30 per cent of its total revenues to come from its retail business in the near future, from the present five per cent.
In 2006-07, the retail business is expected to touch a turnover of Rs700 crore from Rs315 crore in the previous year.
At present, the group has 400 retail outlets, which are expected to go up to 2,000 by 2009 and 4,000 by 2011.
Currently, there are 125 Spencer's stores across 25 cities, comprising eight hypermarkets, five Spencer's Super Stores, 104 Spencer's Daily, three Spencer's Fresh, and five Spencer's Express. The total contracted area for all Spencer's stores across the country is over one million sq ft.