Replying to the news item appearing in a section of media that a credit crunch has hit Vishal Retail hard, Vishal Retail said in a filing to Bombay Stock Exchange: “We are the country’s second largest retailer. We receive expression of interest by a number of PE funds regularly to buy stake in our company. In October 2008, we took the approval of the shareholders for further issue of securities of the company to finance our future growth plans. But due to adverse market situations, we postponed fund raising plans.”
Further the company stated, “Similarly, we receive expression of interest, as general course of trade, from various retail players or other parties for venturing into strategic alliances to render specialised/customised services to our customers.”
The statement is, however, in contrast to what IndiaRetailing reported earlier today. “At the moment there is no proposal or discussion at the board or management level for either the stake sale or any strategic alliance,” added the company in its filing to BSE.
With reference to the expansion plan, the company commented, “The global market is passing through a recession stage. The entire economy is facing liquidity crunch, in spite of initiatives being taken by finance ministry, RBI, SEBI etc. Considering the current volatile market, we have also moderated our expansion plans. Since our expansion plans are now moderated, we do not have any immediate requirement of fund raising. We have adequate liquidity for running our business as usual.”
However, the company concluded by saying that the company will update BSE whenever it formally decides to enter into strategic alliance with other retailers or any proposal for divesting stake in the company.
— Shailesh Shah
