E-commerce giant Amazon Inc. is set to make an equity investment in the Kishore Biyani-led Future Group subsidiary, Future Coupons Ltd. for acquiring a 49 per cent stake consisting of both voting and non-voting shares.
“We have been informed by Kishore Biyani on behalf of the existing shareholders forming part of the promoter group and Future Coupons Ltd. that they have entered into a share subscription agreement and a shareholders’ agreement with Amazon.Com NV Investment Holdings LLC (Amazon),” Future Retail Ltd. said in an exchange filing.
The company is yet to disclose the financial details entailing the transaction but Amazon will get rights to acquire Biyani’s promoter group stake in Future Retail on a later date.
“As a part of the agreement, Amazon has been granted a call option. This call option allows Amazon to acquire all or part of the Promoters’ shareholding in Future Retail Ltd., and is exercisable between the 3rd and 10th year, in certain circumstances, subject to applicable law,” the company said.
The promoters have agreed to certain share transfer restrictions on their shares in the Future Retail for the same tenure, including restrictions to not transfer shares to specified persons, a right of first offer in favour of Amazon, it added.
The transaction is subject to regulatory approvals, the company said.
The group recorded a revenue of Rs. 5,149 crore, a 13.5 per cent rise against the same period in the last fiscal. It reported a growth in profit of 11 per cent, amounting to Rs. 170 crore in the quarter ended 30 June.
The transaction in Future Retail, follows a structured debt fundraise of close to US $ 250 million in apparel retail business Future Lifestyle Fashions, which operates Central and Brand Factory.
The funds were raised from PE firm Blackstone.