Heritage Foods has sold its entire holding representing over 3 per cent stake in Kishore Biyani-led Future Retail for around Rs 132 crore in the open market to mainly repay its long term loans. “The company has disposed off its entire holdings/investment of 1,78,47,420 equity shares held in Future Retail. These shares were sold through stock exchange in open market in various tranches and the net amount of Rs 131.94 crore was received by the company,” Heritage Foods said in a regulatory filing.
In 2016, Future Retail Limited had in an all-stock deal, acquired the retail and allied businesses of Heritage Foods Limited, a company promoted by the family members of then Andhra Pradesh Chief Minister N Chandrababu Naidu. As part of the deal, Heritage decided to then focus on dairy as a single line of business.
Taht year, the two companies signed a definitive agreement, under which all existing 124 retail stores of Heritage in Hyderabad, Bengaluru and Chennai became a part of Future Retail network.
As a part of the deal Heritage Foods got 3.65 per cent share-holding in Future Retail through fresh issuance of shares.
“As part of the scheme of arrangement for the acquisition, Heritage Foods Limited will spin off its retail, bakery, agri-sourcing and veterinary care business in a fully owned subsidiary. Subsequently, all these businesses, except veterinary care, will then be merged with Future Retail Limited. The scheme shall be subject to approvals from relevant regulatory authorities and shareholders of the companies,” a joint statement had read in 2016.