Vishal Retail to change name to V2 Retail, enter real estate

Vishal Retail today said it plans to change its name to 'V2 Retail' and also enter into real estate business for which it is seeking shareholders approval.

"The company board in a meeting held on April 9, 2011 decided to change the name from Vishal Retail to V2 Retail in view of the approved corporate debt restructuring scheme entered into with its lenders," it said in a filing to the Bombay Stock Exchange (BSE).

In March this year, Vishal Retail had announced sale of its retail business to the Sriram Group Company, Airplaza Retail Holdings and the wholesale business to private equity firm TPG Wholesale for a total consideration of Rs 70 crore.

In 2009 Vishal Retail got into financial trouble and piled up debt of around Rs 730 crore. It was forced into a corporate debt restructuring (CDR) programme.

On its move to enter the real estate business, the company said: "The company has once again started the retail business from the very beginning, which it had done at the time of incorporation, so to infuse capital into the retail business, the company should explore new businesses to earn revenue."

Therefore, the board in its meeting decided to enter into real estate business activities besides retail business which would always remain the front running business of the company, the filing added.

The aforesaid proposed activities are not directly covered in the present objects of the Memorandum of Association (MOA) of the company and it is necessary that specific objects be introduced in the MOA to target the intended new activities, it said.

The company has sought its shareholders' approval for the purpose through a postal ballot and has appointed CP Associates as scrutiniser. The result of the ballot will be announced on June 25.

Last week, the company's founder RC Agarwal had told PTI that he planned to launch a chain of stores under the 'V2' brand within the next 2-3 months.

He had said that five hypermarkets would be set up to begin with in Himachal Pradesh, Rajasthan, UP and Jharkhand with an initial investment of up to Rs 8 crore.

The company's scrips closed at Rs 29.45 per share on the BSE, down 0.34% from the previous close. The announcement on the name change however came after the markets closed.