Future Group has forayed into the same line that its CEO has shown a certain disdain for all these years. The very vocal-against-online-retail, brick-and-mortar retailer Kishore Biyani has bought the Rocket Internet-backed online furniture marketplace, FabFurnish.
Although the sum that Future Group has paid for FabFurnish was not disclosed to the media, an amount between Rs 15-20 crore exchanged hands in what was an all-cash transaction, sources were quoted as saying.
FabFurnish is a high margin and profitable business, which currently operates at 40-41 per cent margins. Under Future Group, the home furnishing brand aims to penetrate around 100 more cities.
Future Group, a significant player in the home furnishing segment, hopes that with this acquisition, they can hit the Rs 1,000 crore mark by the end of this year.
With this move, Biyani is making plans to take on the threat that Swedish furnishing giant IKEA poses to Future Group’s home furnishing and furniture brand.
IKEA has already identified India as a key growth market and is opening its first store in the country in 2017, in Hyderabad.
While the entire FabFurnish team has been retained for the time being, Future Group senior executive Mahesh Shah and chief executive of Home Town, the home furnishings business owned by Future Retail, will head the new entity.