Pantaloon office stationery arm Future Office and US-based Staples sign stationery JV

Pantaloon Retail India has announced a joint venture between US-based Staples, Inc. and its new office products business unit, Future Office. The JV firm will serve businesses of all sizes through delivery as well as cash-and-carry locations, offering a wide range of office products from core office supplies to printers to computers.

The agreement establishes a platform for Staples to enter the $10 bn office products market in India and allows Pantaloon Retail to benefit from the industry expertise and sourcing network of the world’s largest office products company.

Read the Business Standard article for the comments of Ron Sargent, chairman & CEO, Staples and Kishore Biyani, MD & CEO, Pantaloon Retail India.

Pantaloon may divest stake in Planet Retail JV

This follows the other news about Pantaloon Retail planning to divest its stake in its subsidiaries. Future Group promoter Kishore Biyani is planning to sell a part of his 49% stake in Planet Retail Holdings (PRHL), a JV between Pantaloon Retail and Indonesian retailer Planet Sports promoted by V P Sharma.

Planet Retail has declined to comment on the issue, while Mr. Biyani has denied any such move on his part.

PRHL sells brands such as Marks & Spencer, Guess, Body Shop, Converse and Speedo in India. The group is also likely to introduce the world’s largest coffee chain Starbucks to India in August.

Planet Retail has the licensing rights for a number of other global brands including Wilson, Puma, Speedo, Converse and Zara. In addition, the company has announced foray into department stores through Debenhams, a UK-based chain. It has also entered the health and beauty segment with the launch of The Body Shop, another UK company which was recently taken over by L’Oreal. Planet Retail has over 55 stores across various concepts and formats with a total retail space of over 1 lakh square feet.

Read The Economic Times article for more details.
Related Post: Pantaloon Retail to divest stakes in subsidiary companies

Pantaloon Retail to divest stakes in subsidiary companies

Pantaloon Retail India Limited (PRIL) is planning to dilute stakes in its subsidiary companies for expansion-related purposes. The companies that are lined up are Future Media, Future Capital, Future Logistics and Central and dilution of stakes would either be way of IPOs, preferential allotment or strategic sale.

Future Media targets developing retail space and malls as an outdoor media option. PRIL is in talks with WPP for a strategic partnership in Future Media. Future Logistics deals in supply chain and distribution management. Future Capital is a PRIL subsidiary that focuses on asset management and consumer finance. It manages Horizon and Kshitij, two real estate investment funds and Indivision, a consumer-related private equity fund, and soon plans to get into insurance, consumer credit and other consumer-related financial products and services. Central is a chain of lifestyle retail stores.

Equity analyst Edelweiss Securities estimates that of PRIL’s total requirement of Rs. 4500 crores, equity dilution would get the company Rs. 1000 crores. Quoting the company’s internal projections, the research firm also says that in all Mr. Biyani’s company needs approximately Rs. 2300 crores from external sources of which Rs. 1300 crores will come in the form of debt. Pantaloon’s expansion plans are targeted at taking the group’s total retail space to about 30 mn square feet by the end of 2011 from the current 3.5 mn square feet. By the end of FY10, Mr. Biyani is looking at 80 Pantaloon stores in various parts of the country from the current number of 23. Similar expansion is in the pipeline for Big Bazaar and Food Bazaar, where the company aims to take the number of stores to 225 and 250 respectively, growing from the current 35 and 53 respectively

In October 2006, ICICI Ventures and Kotak SEAF India had picked 15% and 6% stakes respectively in another PRIL subsidiary, Home Solutions Retail, bringing an investment of about Rs. 120 crores.

Read the article in The Economic Times.