Shriram, TPG to buy Vishal Retail for Rs 100 crore

Sep 13, 2010 |

New Delhi

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Beleaguered discount retailer Vishal Retail on Monday said it would sell its retail trading business to Shriram Group, and the wholesale division to the private equity firm TPG, for a combined value of Rs 100 crore.

In an announcement to the stock exchanges, Vishal retail said the sale, however, does not include the firm's properties in Hubli, Kolkata, Dehradun and Jabalpur. Shriram Group is a Chennai-based diversified group, which deals in property, finance and insurance.

Vishal Retail, one of India's largest discount chains got into financial trouble about a year ago. Last year, the company underwent a corporate debt restructuring programme to restructure its Rs 730-crore debt.

In June, the firm had announced that it had signed a memorandum of understanding with private equity firm TPG. The company operates under brands/corporate identities of Vishal, Vishal Retail, Vishal Megamart and Vishal Fashion Mart.

In the recent past even Kishore Biyani-lead Future Group was speculated to be in talks with Vishal for a possible buyout. For the quarter ended June 30, Vishal posted a net loss of Rs 19.47 crore and net sales of Rs 334.63 crore.

The company's scrip was trading at Rs 55.10 per share on the Bombay Stock Exchange with a hike of 8.36 per cent in the afternoon trade.

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