Subhiksha can be saved: ICICI Venture

24 February 2009

Leading private equity player ICICI Venture Fund Management, an arm of ICICI Bank, is holding talks with lenders and investors like Azim Premji for the revival of Subhiksha, the crisis-hit retail chain based in Chennai.

Speaking to reporters in Mumbai yesterday, ICICI Venture managing director Renuka Ramnath said, ''We are minority shareholders and do not have management control. We are talking to lenders and investors like Azim Premji to find a solution. We will support any revival package for the company.''

Subhiksha, with a chain of 1,600 stores across the country ran into serious liquidity crisis around September, but the management had kept the lenders and investors in the dark about the financial position of the company.

ICICI Venture has written to the Registrar of Companies to order an investigation into the affairs of the company for the period after April 2007 and also to appoint auditor to find out the financial position of the company.

Ramnath said she did not know the exact financial status of the company. The management had always maintained that it was doing well and pursuing an aggressive growth path. ''There was no whiff of liquidity crisis facing the company till September,'' she said.

The management, led by R Subramanian, who has a 59-per cent equity stake in the company, approached ICICI Venture at the end of September to help Subhiksha with a Rs50 crore loan to meet short-term liquidity needs.