Chandrababu Naidu to sell Heritage Foods retail to Kishore Biyani’s Future Group

Future Group has agreed to acquire the retail business of Heritage Foods by issuing 3.65% stake or freshly issued shares worth Rs 295 Crores to the latter.

Heritage Foods is owned by the Andhra Pradesh Chief Minister N Chandra Babu Naidu family. Its retail unit includes the Heritage Fresh chain of supermarkets.

The Kishore Biyani led Future Group will buy the Heritage Foods’ retail unit in an all-stock deal.

Acquisition of Heritage Foods’ retail is expected to complement Future Retail’s existing network of 379 small scale EasyDay Stores across North India.

Under the terms of the deal, Heritage Foods will offload its retail, bakery, agri-sourcing and veterinary care business and form a fully owned subsidiary. Following that all these business units with the exception of veterinary care will be merged into Future Retail of the Future Group.

Future Retail Chairman and Managing Director Kishore Biyani on the Heritage Fresh acquisition said: “The consolidation of Heritage small-format stores brings us closer to the homes of customers in the three key metros in southern India.

“Scale plays an important role in retail, and this forms part of our strategy of aggressively expanding our small stores network to around 3,000 stores nationally by 2021”.

Heritage retail business consists of Heritage Fresh chain of 124 stores in Hyderabad, Bengaluru and Chennai.

N Chandrababu Naidu’s daughter-in-law and also the Heritage Foods Executive Director N Brahmani said: “We are happy to have found a partner in Future Group to expand our retail business, as Heritage Foods continues to focus and expand its dairy and renewables energy business”.

Heritage Fresh stores sell all kinds of household goods, fast moving consumer goods (FMCGs), staples, fruits and vegetables.

Heritage Foods Retail and allied businesses had posted revenue of Rs 629.70 Crores during the fiscal year that ended in March.

Also part of the acquisition is Heritage retail’s Chittoor (Andhra Pradesh) and Medak (Telangana) located agricultural pack houses which serve as supply chain for fruits and vegetables for the Heritage Fresh retail stores.

Heritage Fresh also has a bakery in Hyderabad and markets its products in its retail stores. Additionaly, the Heritage bakery also supplies bakery products to quick-service restaurants including KFC, Pizza Hut and Hard Rock Café.