Aditya Birla to merge More and MFL into Pantaloon

As reported earlier, the Aditya Birla Group may soon merge its two loss-making unlisted entities, Aditya Birla Retail, which runs More retail chain, and Madura Fashion & Lifestyle into Pantaloon Fashion & Retail, a listed entity. Sources suggest that the board of Pantaloon may meet next week to take a decision on the merger proposal.

The restructuring is expected to see Madura getting subsidiarised from the listed Aditya Birla Nuvo with public shareholding. Pantaloons and More will be merged with the demerged Madura and the combined entity is expected to be led by Madura with a projected valuation of 1.5-1.8 billion dollars (over Rs 9,000 to 1,8,000 crores) with Pantaloons and More being the smaller businesses by value in the restructured retail company.

Aditya Birla Group entered fashion retail with the acquisition of Madura for Rs 236 crores in 1999. It entered the food and grocery retail following the acquisition of Fabmall and Trinethra supermarkets in 2007. The department store chain Pantaloons was acquired from Kishore Biyani's Future Group in 2012. At present, the Birlas own 72.62 percent stake in Pantaloon Retail. After the merger, Pantaloon will lead the group’s retail initiatives and create Rs 7,200 crores sales entity, as per fiscal 2014 financial data.