IT czar Azim Premji picks up 6% stake in Kishore Biyani’s Future Retail for Rs 1,700 crore from Bharti Group
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IT czar Azim Premji-led PremjiInvest picked up a 6% stake in Future Retail from Bharti Group for about Rs 1,700 crore, in a block deal on Thursday. “Mittal family which held 9% stake in Future Retail, has sold 6% stake to PremjiInvest. PremjiInvest is one of the larger investors in consumer space in India. They are also investors with us in Future Lifestyle Fashion,” Kishore Biyani, the founder and chief executive officer of Future Group told in an interview to CNBC TV18, adding that the total transaction value is about Rs 1,700 crore.
“The value of the transaction is about Rs 1,700 crore, out of which Future Retail will get up to Rs 575 crore by way of a clawback provision. Future Retail has a provision in terms of the gains coming out of this transaction,” he explained. Notably, even after this deal, Bharti still holds about 3% stake in Future Retail via a group entity called Cedar Support Services. According to Biyani, there is no sense of urgency from Bharti to sell the remaining stake. What is Future Retail planning to do with the amount? “It too early to talk about how to use the proceeds. This will go for expansion and reducing our debt and interest,” Biyani said.
Notably, PremjiInvest had earlier bought 8 per cent stake in Future Lifestyle Fashions. Currently, PremjiInvest’s stake in the Future Lifestyle Fashions stands at about 4 percent, according to an ET Now report. In the interview to CNBC TV18, Kishore Biyani pointed out that at today’s value, Heritage and Bharti’s clawback is valued at Rs 1,800 crore. However, Biyani noted that none of them is in any hurry to sell stake.
Recent media reports had said citing sources that Jeff Bezos-run Amazon is expected to pick up a 10 per cent stake in Future Group for about $400 million. “We are not in discussions of any stake sale at the moment,” Biyani said in response to whether he is looking to sell up to 10% stake.
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