You are here: Home » Companies » News
Business Standard

Alibaba in talks to purchase a minority stake in Spencer's Retail

Spencer's was already in talks with Amazon. Both options were open, sources say

Ishita Ayan Dutt  |  Kolkata 


RP-Sanjiv Goenka’s food and grocery retail chain, Spencer’s Retail, is in talks with for a minority stake sale, said sources close to the development.

Spencer’s was already in talks with Both options (and Alibaba) were open, sources indicated. A meeting with officials was held at RP-SG headquarters recently, said sources. Chairman declined to comment.

The retail and omni-channel space has been buzzing since early this year when acquired in a $16-billion deal. Both and have been in talks with some of the biggest names in the retail space.

ALSO READ: Zomato raises $210 mn from Alibaba's payment affiliate Alipay Singapore

More recently, Amazon closed a deal with the Aditya Birla Group-owned More retail chain. Last month, the signed a deal to sell Aditya Birla Retail to Samara Capital and Amazon for an enterprise value of Rs 42 billion.

Valuation would, however, be a key for the Spencer’s deal. It is expected to register its first profit before tax (PBT) this year. In 2017-18, the company posted a pre-tax loss of Rs 0.30 billion as against the pre-tax loss of Rs 1.29 billion in 2016-17. Its revenue grew by 3.46 per cent at Rs 20.91 billion for the year ended March 31, backed by expansion. Spencer’s currently has 138 stores across its various platforms and 10 more are expected to be added by March. The RP-SG retail chain has a presence in 36 cities.

The chair would be listed on the stock exchanges soon. The group flagship, CESC, which had announced a restructuring of business into four distinct companies, is now going to implement it phase-wise.


The demerger of the power business would be implemented once the approval of the power-purchase agreement (PPA) between the generation and distribution comes through. The non-power investments of CESC would be demerged into two entities, retail and ventures.

ALSO READ: Alibaba accuses US of starting trade war with China over 'unfounded fear'

One of the reasons why CESC was going ahead with demerger without waiting for the approval for the PPA could be that the retail valuations were peaking at this point, some observers said. Also, the company received the certified copy of the National Company Law Tribunal order on October 5. “Now, there would be three companies,” had said.

Each existing shareholder of CESC, for 10 of his shares, would be allotted additional six shares of Rs 5 each in retail and additional two shares of Rs 10 each in the venture company. The record date would be October 31, and listing of retail venture would take place subsequently.

ALSO READ: Alibaba founder Jack Ma tops Hurun China rich list with $39bn of wealth

The retail company is likely to trade as Spencer’s Retail and the venture company comprising business process outsourcing, information technology, FMCG and Quest, is likely to be named RP-SG Ventures.

First Published: Sat, October 13 2018. 02:32 IST