Singapore-based private equity fund L Catterton Asia, which is co-owned by French luxury group LVMH, is acquiring around 10 per cent stake in Indian fashion retail firm Future Lifestyle Fashions through a mix of preferential allotment and secondary purchase of shares.
As per estimates based on the current share price of around Rs 421, the deal could be valued at over Rs 800 crore.
According to a recent filing to the stock exchanges, the board of Future Lifestyle also approved the raising of Rs 170 crore from a preferential issue of equity shares to Spectacular Investments Pte Ltd, which is a wholly-owned arm of L Catterton Asia.
Under the terms of the deal, the Mumbai-based company will be issuing 3.82 million equity shares of face value Rs 2 each of the company at a price of Rs 445.50 per equity share, aggregating to Rs 170 crore and representing a 2 per cent stake.
L Catterton Asia is a unit of one of the largest consumer-focused private equity firms in the world with over $15 billion of equity capital across six fund strategies in 17 offices globally. It was formed through the partnership of Catterton, LVMH and Groupe Arnault.
Future Lifestyle is one of the largest branded apparel retailers in India. It also owns department stores such as Central and Brand Factory and niche formats like Planet Sports. It owns and markets over two dozen fashion brands through exclusive brand outlets, department stores and multi-brand outlets.
“L Catterton Asia’s significant investment in FLFL will enable FLFL’s retail formats, Central and Brand Factory, and own brands to leverage the global fashion and retail expertise of L Catterton to further strengthen and expand the business,” the Indian firm said in a statement.
“We were attracted to FLFL due to its ability to create superior shopping experiences and a curated set of exceptional brands for the Indian consumer. We have jointly identified areas where we can bring our unparalleled fashion and brand experience to unlock value for all stakeholders,” said L Catterton Asia chairman and managing partner Ravi Thakran.
It was also reported last year that after Amazon picked up a stake in Shoppers Stop, rival Flipkart was also in discussions to acquire an 8-10 per cent stake in the listed fashion arm of the Future Group.
In July last year, Wipro Ltd chairman Azim Premji‘s investment arm PremjiInvest had acquired an additional 3.26 per cent stake in Future Lifestyle through open market transactions for around $30 million. At the time, PremjiInvest increased its stake to 11.43 per cent stake in FLFL.
L Catterton’s India portfolio also includes apparel retailer Genesis Luxury. It exited ethnic fashion retailer Fabindia a couple of years ago.