Future Lifestyle to raise Rs 300 cr for expansion

Kishore Biyani-led Future Lifestyle plans to raise Rs 300 crores on a preferential basis to carry out its expansion plans.

The funds would be utilized to bring down debt. The company has informed the Bombay Stock Exchange that its board will meet and approve issue of equity shares or debentures to one or more persons on preferential basis.

Meanwhile in order to reduce debt and turn profitable, Future Group plans to hive off its private brands like Tasty Treat, Clean Mate, Fresh & Pure and Sach as separate entities apart from retailing at its own stores. Sighting high margins earned through lifestyle segment, the group has decided to push the private brands under its portfolio. Private brands under the group’s FMCG fold enjoy 15-20 percent market share and in home and cleaning, the share is 30-35 percent.

Future Retail, including Big Bazaar, Food Bazaar, Home Town and private brands, demerged its fashion business in November 2012 and formed a new company called Future Lifestyle Fashions (FLFL). FLFL has a portfolio of over two dozen fashion and lifestyle brands. Earlier, the Future Group also announced its plans of separating its private labels Bare and Rig by opening exclusive stores for the two. Plans are also in the pipeline to expand its ‘I am In’, youth-oriented fashion chain launched last year. The plan includes setting up more than ten stores this year in Tier II and Tier III cities apart from focusing ecommerce.

Future Lifestyle currently operates more than 4 million square feet of retail space and is aggressively scaling up business through acquisition of smaller regional brands. The chain has been focusing on increasing high margin lifestyle retail business. Over a year ago, Future Retail tried to simplify its business structure by creating three different entities — Future Retail which houses its value retail (hypermarkets and supermarkets), Future Lifestyle Fashions for fashion and lifestyle retail, and Future Ventures India for the consumer products businesses.