Pantaloon to raise Rs 1260 cr through issue of shares

28 Aug, 2007, 1830 hrs IST, PTI

MUMBAI: Kishore Biyani-promoted Pantaloon Retail India on Tuesday said it would seek shareholders’ approval for raising Rs 1,260 crore through the issue of shares and warrants on a preferential basis to investors including Bennett, Coleman & Company Ltd and the promoters.

The company would convene the Extra Ordinary General Meeting (EGM) of shareholders on September 18 for approving the issue of shares and warrants, it said in a filing to the Bombay Stock Exchange.

The firm plans to issue 2.12 crore warrants to the promoter group and other investors at an issue price of Rs 500 each convertible into one equity share of Rs 2 each at a premium of Rs 498, aggregating Rs 1,060 crore, the company said.

Accordingly, promoters group would be allotted two crore warrants, while employees of Future Group or their spouses would get 10 lakh warrants and two lakh warrants would be allotted to IL & FS Trust Company, trustee of Pantaloon Employees Welfare Trust.

The retailer also plans to issue 40 lakh equity shares of Rs 2 each at a premium of Rs 498 per equity share to private investors aggregating Rs 200 crore. The private investors include Bennett, Coleman and Company which would receive 30 lakh equity shares and three individuals would receive the remaining 10 lakh shares.

The firm’s shares closed at Rs 486.90, up 1.29 per cent on the BSE.

Law of nature

Posted online: Sunday , August 26, 2007 at 2231 hrs

At the BSE annual day, a varied group of panellists spoke on the challenge of securing inclusive growth. Future Group chief Kishore Biyani had his own take on voluntary reservations and social engineering. Corporate India could do its own bit to overcome imbalances between India One (read urban centres) and India Two (the rural poor), he held. His group, he added, already had a high proportion of minority employees. “As a company, we have principles,” he explained, “and one of the principles is that we should not disturb the law of nature.” He also had the audience in splits when he said he measured inclusive growth with the help of a happiness index. “According to me, happiness is an index of inclusive growth. The way we look at inclusive growth in our organisation is that how many people gain happiness by shopping at our stores.” With the government’s exhortations on diversity making such natural impact, who needs a law of legislation?

Law of buds

It was an event to launch Aarti Kochhar’s book, Recipes for Success, in which she speaks to several notables from Mukesh Ambani to Amitabh Bachchan on what tickles their tastebuds. Most of the influential people young Kochhar—daughter of Chanda Kochhar—inter-viewed said they preferred homemade delicacies like dal-chawal or paneer.

But the Big B, chief guest, couldn’t resist some leg-pulling at the expense of Jet Airways’ chairman Naresh Goyal who said his favourite food was pizza. “Most of us love ghar ka khana,” he announced, “but some of us can’t do without Italian food.”

Shree Ram Mills to house RIL’s first hypermarket

August 22, 2007

Mukesh Ambani has chosen the sprawling Shree Ram Mills property at Lower Parel in central Mumbai to launch Reliance Retail’s first hypermarket (discount store) in the city. Reliance’s four-storey office building at Shree Ram Mills compound will be converted into a mega store, which will be located close to Pantaloon’s Big Bazaar discount store at Phenoix Mills.

Reliance Retail, which ventured into hypermarket business by opening a 1.65 lakh sqft store in Ahmedabad last week, plans to start the construction of hypermarket shortly, according to industry sources. A Reliance group spokesperson declined to comment on the issue.

Reliance group executives will be moved out of Shree Ram Mills building to the new swanky corporate office at Koperkhairane in Navi Mumbai.

“Around 700 employees are now housed at the property. Some people have already moved out,” said the source. Before the split of Ambani brothers, Reliance Infocomm’s (now Reliance Communications.) corporate office used to function from the building. Reliance had bought the property from Kasliwals eight years back. Post split, the property went to Mukesh Ambani group.

Reliance Retail is planning to build a 50000-60000 sqft store at the location which is fast transforming into Mumbai’s corporate hub.

Reliance plans retail university by 2008-09

21 Aug, 2007, 2115 hrs IST, PTI

NEW DELHI: Mukesh Ambani-promoted Reliance Retail on Tuesday said it is planning to start a retail university by 2008-09 and is in discussions with learning partners across the country.

 

“Once big retail format stores like RelianceMart kick off in large numbers, which we expect to happen by 2008-09, the retail university will also start,” Reliance Retail Lifestlyle (RRL) President and Chief Executive Officer Bijou Kurien said on the sidelines of CII Marketing Summit here.

 

He said the company was in the process of developing tie-ups with various partners for developing retail curriculum that suit the requirements of the industry.

 

Kurien said the courses would focus mainly on requirement of the front-end operations although lessons on back-end processes would also be imparted.

 

When asked about the number of the study centres under the university, he said those would be at many locations and depend on the presence of the large retail stores.

 

Earlier this May, rival Bharti Enterprise announced a tie-up with Global Retail School (GRS) to impart training in the retail sector. Reliance and Bharti are also competing with each other in the retail sector and are investing billions of dollars to expand their business.

 

According to industry estimates, the Indian retail sector would offer around 2.5 lakh jobs in the next two years with 75 per cent of them being customer facing.

 

The Bharti-GRS joint venture plans to set up 60 centres across the country, including smaller towns and cities this year. Bharti is a technical partner in the joint venture, which would provide content and curriculum support for the courses and hire the skilled personnel.

 

Asda, Sainsbury’s and Tesco looking for green crusaders

Julia Finch
Monday August 20, 2007
The Guardian

The three biggest supermarket groups, which are battling to be viewed as the most environmentally friendly, are all searching for new directors of corporate social responsibility to lead their green crusades.The vacancies are the result of resignations at Sainsbury’s and Asda and a decision by Tesco to recruit a new specialist to work with the grocer’s government affairs director, who had been taking responsibility for improving Tesco’s green credentials.

Over the past two years the big grocers have announced a stream of initiatives on everything from using fewer carrier bags to generating wind power and fighting child obesity. The CSR director has changed from being regarded as something of a box-ticking backwater of a job to a high profile position as consumers have become more aware of the supermarkets’ effect on the environment.

Sainsbury’s CSR specialist, Helen Lo, has handed in her resignation. She is still employed by the grocer but has moved to work on a special project while she works her notice period.

Ms Lo joined Sainsbury’s this year from Unilever, where she was head of CSR and sustainability. She previously worked for the National Farmers’ Union and before that spent 14 years at Sainsbury’s.

Sainsbury’s director of communications, Pip Wood, is overseeing Ms Lo’s previous responsibilities.

Asda’s environmental specialist, Ian Bowles, has also quit, after more than five years. A spokesman for Asda said Mr Bowles “just wanted a change and some down time”. The search for his successor is being led by Paul Kelly, Asda’s new director of corporate affairs.

Tesco is searching for a new director of CSR to work with David North, the grocer’s director of government affairs.

Mr North, who previously worked at 10 Downing Street advising Tony Blair on rural affairs, has overseen the supermarket’s community initiative, a 10-point plan to reinvent it as a “good neighbour”.

ExxonMobil, NTUC Fairprice roll out convenience store concept

SINGAPORE: ExxonMobil and Singapore’s largest supermarket chain, NTUC Fairprice, have successfully rolled out its network of convenience stores.

There are now 74 of them at petrol kiosks across the island.

The tie-up between the two companies seems to be making a lot of business sense as Fairprice said sales at the refurbished petrol-marts have risen by an average of 24 percent.

One outlet even registered a 200 percent jump.

Seah Kian Peng, Managing Director of NTUC Fairprice Co-operative, said: “It’s not just about our mart sales, even the petrol sales have seen an improvement. More importantly, we’ve created more jobs as well. This station, for example, used to employ only 13 staff, now we are employing 16.”

Vincent Chong, Retail Manager of ExxonMobil Asia Pacific, said: “The alliance brings about some synergies – the labour productivity has gone up by close to 30 percent and that translates to efficiencies in our operation.”

About S$30 million went into sprucing up the premises of the 74 outlets, which are made up of Fairprice Xpress and Cheers stores.

These petrol-marts are expected to complement promotional efforts of the Fairprice supermarket chain.

Many of the outlets fall under what Fairprice calls, the “Big Box” format – a store with a retail space of 150 square metres, which is twice the size of a conventional petrol-mart.

Apart from grocery, the stores sell hot food and gourmet coffee, with a call-to-order service for patrons who want to pre-order their food.

And due to an agreement with DBS bank, customers can enjoy ATM banking services as well at these petrol-marts.

Fairprice is also piloting laundry services and selling organic food products at selected stores.

Some products may cost slightly more at the petrol-marts than the supermarkets but Fairprice said it would be absorbing the 2 percent Goods and Services Tax hike for the top 100 bestselling products for a period of six months.

Minister of State for Trade and Industry Lee Yi Shyan said these new-generation petrol kiosks show that to stay ahead, businesses need to be willing to change and forge new partnerships.

He said: “Crossing or merging traditional industry boundaries is a good way to create new business model to beat competition. Many of our retailers need to consider this approach in order to differentiate themselves and compete.”

Mr Lee added that the government would continue to improve the business and operating environment here.

For instance, the Pro-Enterprise Panel has accepted more than half of the over 1,600 suggestions from the business community to provide Singapore with the best conditions for success. 

SPAR ties up with Landmark for a bite of Indian market

NEW DELHI/MUMBAI: SPAR, the Dutch food retail franchise, is back for a second innings in India. After a failed tie-up with Radhakrishna Foodland in Mumbai nearly two years ago, it has entered into a new franchising agreement with the Dubai-based Landmark Group for its Max hypermarkets and supermarkets.

Under the agreement, not only with Landmark get access to the brand name, SPAR will also handle the entire merchandising and display for the chain. The first two stores carrying the SPAR brand name, expected to be about 70,000 to 1,00,000 sq ft, will come up in Bangalore next month.

The Euro 27 bn SPAR is an international retail franchise spread over 13,700 stores in 33 countries. SPAR operates on a principle similar to co-operative stores, bringing together many retailers under a single fold to facilitate bigger discounts on bulk deals and better supply chain management.

This time around, SPAR isn’t focusing on buying for the traditional trade, but concentrating only on modern organised retail. The agreement with Max envisages building a chain of 9 hypermarkets and supermarkets over the next two years.

In a statement, SPAR International MD Gordon Campbell said, “This is an exciting and important development for us. Developing SPAR hypermarkets in India is a key element in our strategic plan. India is a market with enormous potential and we are pleased to have found an excellent partner in Max Hypermarkets.”

According to the license agreement, the Landmark group will handle the back-end and front-end. The license, which was inked couple of days ago, spans across India. Based on a rental model the hypermarkets will be typically spread across 70-1,00,000 sq feet while the supermarkets will be in the area of 20-30,000 sq feet. With an initial outlay of Rs 200 crore, the group is targeting a revenue of Rs 600 crore in the next two years.

Landmark will pay SPAR an annual franchisee fee based on a quarterly basis depending on various criterion. Currently, even though they hold the licence for food and grocery branding, the Landmark group will begin by using their private label MAX.

“Since we had been working on the private label for a while to start with it might be branded Max but slowly we will get the SPAR brand into the private labels as well,” said Viney Singh, MD of Max Hypermarkets. Right now, Max will kick off with its food and apparel private label but later get into durables, home appliances and general merchandise.

In its previous foray, SPAR had been unable to garner support from traditional retailers because many of them feared they would end by losing their independence. They had been promised the use of the SPAR brand name and the benefits of centralised buying.

Said Damodar Mall, chief executive (innovation and incubation) of Future Group, “In an environment where modern trade is still growing and consumption is rising by 8-9%, the traditional retailers aren’t threatened to the same extent as more developed retail markets.”

Retail returns to heritage edifice

It was where British army officers stationed in Singapore on short furlough would shop for a “decent lifestyle”. You could power-dress in tropical linen suits, sip lemon tea and dig into cucumber sandwiches for breakfast at the lifestyle retail rendezvous.
Circa 2007: This Christmas, you can pick up 40 varieties of papads and pickles, besides an array of handmade products from all over India, and shop for your household needs, from the same place, reborn.
Metropolitan Building, the colonial edifice which once housed Whiteway, Laidlaw & Co, then Asia’s largest departmental store, will now be home to Pantaloon Retail (India) Ltd’s “uniquely Indian” hypermarket chain stop, Big Bazaar.
The 37,000-sq-ft, two-level shop-stop will represent the rebirth of organised retail in the listed heritage building owned by the LIC, the façade of which is being restored under the supervision of architect Dulal Mukherjee.
Pantaloon Retail has engaged a team from National Institute of Design, Ahmedabad, to do the interior of the store, with the design brief of “being sensitive” to Calcutta’s urban history and cultural ethos, and create a solution that blends the past with contemporary needs.
While the overall product-mix will be in sync with the profile of the value-shopping chain, the Metropolitan Big Bazaar will incorporate some special categories and kiosks, like Hands of India (showcasing handmade stuff), Sanjha (celebrating India’s ethnic chic) and a Journey of India through its regional delicacies.
The space in the heritage address was obtained by Eden developers from LIC on a 25-year lease-rental agreement, with a provision for extension, says Manish Agarwal, the executive director of Pioneer Property Management Ltd, which brokered the deal.
“Pantaloon Retail has entered into a deal with Eden Developers to run a retail store on the premises with the consent of LIC,” says Agarwal.
It is learnt that Reliance and Vishal were also in the race for the Chowringhee property.
“Since this is an adaptive reuse, the contrast in the design shouldn’t be in disrespect to the building’s history. Also, signage has to be as sensitive as the ambience inside… One has to be careful not to destroy the heritage fabric,” warns architect and urban designer Partha Ranjan Das.

Reliance retail war hots up

Calcutta, Aug. 20: The Forward Bloc-run agriculture marketing board today threatened a “law-and-order problem” if the government doesn’t stop Reliance from entering Bengal’s farm retail market.
The threat has come at a time the CPM-controlled food processing department has paved the way for the company’s foray into the sector.
The Bloc and other Left Front partners like the RSP and the CPI are planning to organise protests by traders through a statewide bandh in markets.
“The traders’ protests against Reliance’s entry in farm retail will trigger law-and-or-der problems. They are angry because the government is helping Reliance acquire space for its retail shops. We’ll ask the chief minister to restrain Reliance from making clandestine moves to open outlets without permission from the board,” chairman Naren Chatterjee said.
He said the board has refused to issue a licence Mukesh Ambani’s company had sought to procure farm produce from farmers directly for its six proposed distribution centres, which would serve its retail outlets called Reliance Fresh.
“We have denied the licence since Reliance is planning to monopolise the entire chain of farm products marketing in the state, endangering the livelihood of lakhs of small traders. Now, the company is trying to make a backdoor entry by calling their distribution centres food processing units,” Chatterjee said.
The Bloc leader has sent letters to food processing minister Mohanta Chatterjee and land and land reforms minister Abdur Rezzak Mollah opposing the clearance given to Reliance to hold 600 acres for its six distribution centres.
The tag of food processing units will help Reliance retain land in excess of the ceiling.
“We considered it an in- fringement of the board’s authority and requested the ministers not to interfere,” Bloc leader Chatterjee said and added that the board would write to municipal bodies not to issue trade licences to Reliance shops without the board’s approval.
Bloc state secretary Ashok Ghosh, who supported the attack of Reliance sites as an “expression of public fury”, today repeated his demand for a bilateral meeting with the CPM on the issue.
Mohanta Chatterjee said he had acted under the instructions of chief minister Buddhadeb Bhattacharjee, who, he said, told him to go through the Reliance proposals and take “appropriate” action.
Mollah has written back, saying his office would not do anything “beyond the law”.

Govt slammed for nod to Reliance retail

Statesman News Service
KOLKATA, Aug. 20: Forward Bloc leader and chairman of the West Bengal State Marketing Board, Mr Naren Chatterjee has sent letters admonishing the two CPI-M ministers, Mr Abdur Rezzak Mollah, land and land reforms department and Mr Mahanta Chatterjee, food processing and horticulture department, for superseding the Marketing Board in giving permission to Reliance to set up its retail chain, Reliance Fresh, in the state.

From the very beginning, Forward Bloc has been opposed to Reliance or any other large corporate entering the agri-marketing scene. Only two days back, Forward Bloc activists ransacked the premises of the first potential Reliance Fresh retail outlet in north Kolkata. Former chief minister Mr Jyoti Basu today admitted that there are differences among Left Front partners on this issue and the matter needs to be discussed.

Mr Naren Chatterjee said: “Reliance and other corporates like Metro Cash should stay away from agri-marketing in the state. I object to the food processing and land and land reforms departments for trying to allow Reliance entry into agri-marketing. Calling their centers ’food processing units’ is mere eyewash. The food processing and horticulture department does not have jurisdiction to give Reliance permission.”

In his letter to Mr Mahanta Chatterjee, the chairman of the State Marketing Board has said: “…it is expected that your department will not interfere in activities relating to marketing of agricultural produce in any manner including setting up of any parallel marketing network…”

In another letter to Mr Abdur Rezzak Mollah, the chairman wrote: “…No land is to be allotted nor is any relaxation in land ceiling allowed to any private commercial organisation for establishing markets of agri-produce without recommendation from the Agriculture Marketing Department.” Mr Mollah however replied back within two hours saying that he didn’t do anything bypassing the existing laws.

Mr Naren Chatterjee said that agriculture traders in the state were feeling threatened by Reliance’s purported entry, and there could even be a law and order situation in the state.

“I have met vendors’ associations and they are very agitated about the situation. Agricultural traders are angry too. If Reliance enters agri-marketing, there will be an uprising in the state. There might be a serious law and order situation. The state government should look after the larger public interest,” Mr Chatterjee said.

The State Marketing Board proposes to have its own agri-marketing network and retail outlet, waking up to this need rather suddenly. “We will write a letter to the state government to have at least 10 per cent of the total agricultural produce sold through public retail units,” Mr Chatterjee said.