Sindhu J. Bhattacharya
New Delhi, May 29
SHOPPERS' Stop plans to complete the acquisition of 100 per cent stake in bookstore chain Crossword by June 30.
With 51 per cent existing stake in Crossword, the Raheja Group company plans to buy out the remaining 49 per cent held by ICICI Ventures. However, the cost of this acquisition is still to be finalised.
The MD and CEO of Shoppers' Stop, Mr B.S. Nagesh, told Business Line "ICICI Ventures bought into Crossword five years ago and is now looking for an exit option. This company holds a 6-7 per cent stake in Shoppers' Stop as well. We have agreed to buy out the 49 per cent equity ICICI Ventures holds in Crossword on or before June 30. This acquisition will enable us to add more value to Crossword's operations. However, we have not yet decided on the price for this deal".
He said when Shoppers' Stop had bought 51 per cent equity in Crossword five years ago, it had paid close to Rs 14 crore for acquiring the `Crossword' brand and another Rs 10 crore for the 51 per cent stake, making the total acquisition cost at that time around Rs 25 crore.
Meanwhile, Crossword is eyeing over 80 per cent growth in sales this fiscal. The bookstore chain is targeting to close 2005-06 at Rs 110 crore. On the anvil is expansion into several new cities, with Rs 75 crore investment lined up over the next five years.
The CEO and MD of Crossword, Mr R. Sriram, said "we are present in nine cities with 26 stores at present. Through a combination of franchisee stores and our own, we plan to substantially expand our retail presence. We have earmarked Rs 75 crore investment over the next five years in expansion within the country".
The company has just opened its first store in Gurgaon, and is planning to set up more outlets in Delhi soon.