Under the agreement, Agarwal Business House will take over all the assets and brand, while any liabilities will be adjusted for arriving at the final consideration.
Flickr/shankar s./ CC BY-SA 2.0
Fashion brand Shoppers Stop, which operates over 80 department stores across India, has sold its subsidiary Crossword Bookstores to the owners of its Pune-based franchisee, Agarwal Business House (ABH). The deal is valued at Rs 41.6 crore. The sale has been closed pursuant to the share purchase agreement between Shoppers Stop and ABH signed on Tuesday, August 31. Under the agreement, ABH will take over all the assets and the brand, while any liabilities will be adjusted for arriving at the final consideration. “The sale of the Crossword Bookstores is consistent with the company's strategic plans, which is to focus on its core business and expand its strategic pillars viz, First Citizen, Private Labels, Beauty, and most importantly, its Omnichannel business, which has grown more than 3 times in the last one year,” Shoppers Stop said in a statement. The Board approved the transaction in the board meeting held on August 31. Subject to receipt of necessary approvals, Shoppers Stop will divest 51% stake (expected to be completed within 15 days) and another 39% in the next 12 months. ABH is a franchisee of Crossword and operates 26 stores. Venu Nair, Managing Director and Chief Executive Officer of Shoppers Stop, said, “We’re pleased to continue the business transformation we set out to accomplish from last March and selling the books’ business is an important part of that strategy. This represents another step in our progress to elevate Shoppers Stop to a customer focused, Omnichannel retailer, to enable us to deliver on the promises we make to our customers and shareholders.” “Most importantly, we’re selling Crossword Bookstores to our franchisee ABH, who has been in this business for more than two decades and are extremely passionate about the book business. We are extremely confident ABH will grow the book business and take it to the next level,” he added. As of March 31, Shoppers Stop had 29 Crossword stores across 13 cities, down from 41 stores in FY20. However, the subsidiary has been posting losses, with a net loss of Rs 12.91 crore in FY21, and a net loss of Rs 12.49 crore in the previous year. “We’re very excited about the beginning of a new journey for this iconic brand. Crossword 2.0 is about focusing on readers and improving the overall customer experience. We’re planning to infuse a significant amount for renovation, expansion, and the new Omni Journey,” said Aakash Gupta on behalf of the acquiring family.
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