Future Consumer to raise Rs 350 crore, acquire Athena Life Sciences brands

Investments-TS-1200Kishore Biyani’s Future ConsumerNSE 1.57 % said it plans to raise Rs 350 crore from existing investors – International Finance Corporation, Verlinvest and promoters to fund expansion plans.

IFC, a member of the World Bank Group will invest Rs 210 crore while Verlinvest SA, an investment companyNSE 0.22 % of Belgium-based founding families of Anheuser-Busch InBev, will invest Rs 70 crore through preferential allotment of compulsory convertible debentures (CCD), it said in a stock exchange notice on Sunday. IFC holds about 3 per cent stake and Verlinvest has 7 per cent stake in Future Consumer. Existing promoter group will infuse another Rs 70 crore.

“The primary purpose of the fund raising is to fund various expansion plans and business initiatives of the company and improvement of costs and maturity profile of existing debt thereby further strengthening the balance sheet of FCL,” the statement added.

The CCDs are convertible into equity shares of the company within 18 months from the date of allotment, at a conversion price Rs 45.02 per equity share.

The board also approved the acquisition of personal care portfolio of Ahmedabad-based cosmeceutical and therapeutic beauty treatment company, Athena Life Sciences, through share swap on a net worth of Rs98 crore. Athena’s brands includes Iraya, an ayurvedic personal care brand, Hair for Sure, a hair regrowth treatment, and antidandruff lotion D’Free. The acquisition enables FCL to expand its portfolio in high margin categories of skin and hair care, it said. ET had first reported on the possible deal in its May 29 edition last year.

Future Consumer (FCL) products started as own brands or private labels nearly a decade ago before Future Group founder Kishore Biyani restructured the portfolio into a separate FMCG company. Last fiscal, Future Consumer launched more than 400 new products and stock keeping units (SKUs) and posted 42 per cent rise in revenues to Rs 3,005 crore.