Companies

FirstCry, Mahindra Retail consolidate business

Our Bureau Mumbai | Updated on January 16, 2018 Published on October 15, 2016

Mahindra & Mahindra Ltd on Saturday said the franchisee division of its subsidiary Mahindra Retail Pvt Ltd (MRPL) is being transferred as a going concern on a slump sale basis for lumpsum consideration of Rs 362.1 crore to Brainbees Solutions Pvt Ltd (“Firstcry”).

The franchisee division generates a turnover/ revenue/ income of Rs 16.43 crore, aggregating 8.19 per cent of the turnover/ revenue/ income of MRPL, said Mahindra & Mahindra in a notice to the stock exchange.

In a joint statement, FirstCry.com (BrainBees Solutions Pvt Ltd) and Mahindra Retail (BabyOye) said they have consolidated their business activities to create a dominant presence in the baby and kids market in India.

The merged entity will conduct its business under the brand name FirstCry.com, a FirstCry Mahindra Venture.

FirstCry.com will have a parent base of over 4 million, a footprint of over 300 stores spread across 125 cities.

“A Business Transfer Agreement (BTA) has been executed by and between MRPL, Firstcry and founder shareholders of Firstcry on October 15, 2016…The rationale for the slump sale is to strengthen presence in the combined offline retail and online environments in India’s baby and kids market,” it said.

The notice said the consideration for the sale will be discharged by Firstcry by way of issuance of equity shares aggregating Rs 354.6 crore and payment of Rs 7.5 crore in cash.

The statement said FirstCry has additionally raised $34 million of new equity capital from the Mahindra Group, Adveq (a large private equity fund), Kris Gopalakrishnan and participation from all existing shareholders.

Published on October 15, 2016
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