RP Sanjiv Goenka Group-owned Spencer’s Retail Ltd will buy 100 per cent of premium grocery and fresh fruits retailer Nature’s Basket from Godrej Industries for ₹300 crore in an all-cash deal.
Western push
The acquisition will allow Spencer’s a strong foothold in the western India market, which it had vacated in 2013.
Nature’s Basket began operations in 2005. It reported a turnover of ₹338.3 crore in FY19, up 17 per cent from ₹289 crore in FY18. It has 36 outlets across Mumbai, Pune and Bengaluru.
The deal is likely to be concluded within three months, said Shashwat Goenka, Sector Head - Retail and FMCG at RP Sanjiv Goenka Group. “This acquisition makes us a pan-India player,” he added.
“The acquisition of Nature’s Basket is expected to add to our topline. However, the impact on the bottomline will be clear in the long term,” Goenka said, without specifying how the deal would be funded. Spencer’s is a debt-free company.
According to Abneesh Ray, Senior Vice-President, Institutional Equities, Edelweiss Securities, the high-end grocery business in India is “niche, tough and loss-making”. “Consolidation continues to be in favour of core retailers,” he said. For Godrej, organised retail is a non-core business, market insiders pointed out.