As part of the new strategy, the company's board has decided to reorganise its retail business along three verticals fashion, retail and consumer durables - with each being hived off as a separate legal entity. With the move, t he listed entity is likely to be rechristened Future Market & Consumer Group Ltd, which will be the operating company for the FMCG and consumer business and also serve as the holding company for the other two entities. The fashion company will be called Future Fashion Merchandising Ltd and the retail company, Future Consumer Enterprise Ltd.
Post the board meeting, Kishore Biyani, managing director, Pantaloon Retail told FE, Spearheading strong focus in core business such as FMCG, consumer durables, fashion retail, Rs 750 crore will be pumped in for expansion plans for Future Fashion and other retail companies, whereas, Rs 400 crore to Rs 500 crore will go towards expansion of Future Brands, Future Logistics, Future Learnings and Development.
Biyani also added that the move will enable Pantaloon Retail to meet up with its targeted expansion plans. The company has already approached lenders like Carlyle, Blackstone, Bain Capital, KKR and the Goldman Sachs PE arm. The group is said to have engaged investment bankers Enam, Edelweiss and JM Financial as advisors for the fund-raising programme.
According to Biyani, Since consumers deferred buying new homes due to economic slowdown, Pantaloon's home retailing sales for March, like in previous months, recorded a 10.29% dip. Pantaloon Retail is also planning to cut prices of its food products to a 2007 level soon as it believes that consumers will not stop buying food and other basic necessities, he added.