Mumbai: Kishore Biyani-led Future Group on Thursday evening said that American e-commerce giant Amazon.com is acquiring a 49% stake in a group entity — Future Coupons Ltd.
“We have been informed by Mr. Kishore Biyani on behalf of the existing shareholders forming part of the promoter group and Future Coupons Ltd that they have entered into a share subscription agreement and a shareholders’ agreement with Amazon.Com NV Investment Holdings LLC (Amazon),” Biyani’s company Future Retail Ltd said in an exchange filing.
Pursuant to these agreements, Amazon has agreed to make an equity investment in Future Coupons for acquiring a 49% stake comprising both voting and non-voting shares, the company said.
Financial details of the transaction were not disclosed.
As part of the investment, Amazon is also getting rights to acquire Biyani’s promoter group stake in Future Retail at a future date.
“As part of the agreement, Amazon has been granted a call option. This call option allows Amazon to acquire all or part of the Promoters’ shareholding in Future Retail Ltd, and is exercisable between the 3rd to 10th years, in certain circumstances, subject to applicable law,” the company said.
The promoters have also agreed to certain share transfer restrictions on their shares in the Future Retail for the same tenure, including restrictions to not transfer shares to specified persons, a right of first offer in favour of Amazon, it added.
The transaction is subject to regulatory approvals, the company said.
Future Retail operates Biyani’s popular retail chain of Big Bazaar and other smaller format retail outlets under EasyDay and Heritage Fresh across more than 400 cities through digital platforms and over 1,500 stores that cover over 16 million square feet of retail space.
As of 30 June, the company operated 293 Big Bazaar stores.
The retail chain operator recorded a revenue of ₹5,149 crore, a y-o-y jump of 13.5% over the same period last year. It reported a profit growth of 11% to ₹170 crore in the quarter ended 30 June.
The transaction in Future Retail, follows a structured debt fundraise of close to $250 million in Biyani’s apparel retail business Future Lifestyle Fashions, which operates Central and Brand Factory. The funds were raised from PE firm Blackstone.