Shoppers Stop hit a fresh 52-week high of Rs 552, rallied 9% on BSE in intra-day trade, and Future Retail surged 6% to Rs 559 in early morning trade.
“The board of directors of Shoppers Stop, at its meeting held on Thursday, October 5, 2017, has approved sale of 77.16 million equity shares of Rs 10 each, constituting 51.09% of the paid up share capital of HyperCity Retail (India); (HyperCity / subsidiary company) to Future Retail,” Shoppers Stop said in a statement.
The takeover value of Rs 911 crore includes Rs 655 crore of stock and cash, remaining being debt. The deal will be funded through share and cash as part of which the seller will get about two per cent stake (9.31 million shares) in Future Retail.
“The acquisition would result in further consolidation in the business of Future Retail and increase its foothold in the hypermarket business,” Future Retail said in its communication to exchanges.
At 09:33 AM; Shoppers Stop and Future Retail erase early morning gains, trading 3.5% higher at Rs 525 and Rs 546, respectively.