June: 2007
After Aditya Birla–Trinethra and Reliance–Adani Retail deal, more consolidation is happening among small and medium-sized retailers. Mumbai-based Wadhawan Retail, owners of stores under name ‘Spinach’ have taken over Delhi-based Sabka Bazaar and The Home Store for over Rs.100 crores.
Wadhawan has also bought 15 outlets of Mumbai’s co-operative Maratha Stores. The Home Store offers home and lifestyle products and present in nine major cities while Sabka Bazaar sells food and grocery items has 35 stores in Delhi-NCR.
The acquisitions slips nicely into Spinach’s fold as Wadhawan Food Retail had plans to open 1,500 stores in 90 cities. Currently it has 23 Spinach stores in Mumbai. It gives a good hold in the northern and Mumbai market and initially would retain the same brands as they are well-known in their respective regions and own clientele. .
The Home Store was also in need of funds to expand and looking for Rs.150 crore funding from venture capitalists to expand its operations nationally with 100 outlets. Besides this it is establishing 3 hypermarkets in northern India for Rs.15 crore.
Now, Wadhawan Retail (a retail venture of Dewan Housing Finance) would spruce up the acquired outlets to take on Reliance Fresh and Food Bazaar. Spinach earlier bought HLL’s home-delivery retail business, Sangam Direct in Mumbai.
As unorganised retailing picks pace in India, small and medium sized retailers will consolidate to scale up their operations and meet capital requirements. Also, they could then meet with problems of rising real estate prices and lack of quality space availability.
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