“The reports of us looking for an exit route are absolutely baseless,” exclaimed Mohit Katar, president, marketing, Subhiksha Trading Services Limited. This comment was in response to confirming news about food and grocery retailer Subhiksha looking for an exit route as reported in India’s leading financial daily.
According to Katar, the news was definitely plugged in as it has always happened tactically at a time when Subhiksha plans to “do something big.” The recent plans for the company include setting up of large format consumer durables stores across Tier I and Tier II cities and the target is to have about 100 stores by the first quarter of 2009.
Recently, the company received the Wipro alliance as well when Azim Premji, promoter of Wipro bought a 10 per cent stake in Subhiksha. The transaction was done by Premji’s personal investment entity Zash Investments Ltd. The stake was bought from ICICI Ventures, a private equity arm of ICICI Bank. Post this, Subhiksha’s promoters will have 59 per cent stake in the company, which will closely be followed by ICICI Venture’s having 23 per cent stake. Mutual finds have up to 5 per cent holdings followed by employees control through ESOP’s which is to an effect of 3 per cent.