Future Consumer’s Quest for Value continues

Future Group is continuously trying to redefine the consumer space in India. Recently, Future Consumer Limited also came up with a new vision “FMCG 2.0” based on key pillars like Data Science, Multiple Categories, Integrated Value Chain and Digital Distribution Network.

In a move to enhance its product portfolio, Future Consumer Limited is set to acquire the “Identified Undertaking” of Mumbai based Athena Life Sciences Private Limited.

Future Consumer Limited (“FCL”) is an integrated food and FMCG company that markets brands such as Tasty Treat, Golden Harvest, Sunkist, Sangi‘s Kitchen, Desi Atta Company, Kara, Swiss Tempelle, CareMate, Clean Mate, Think Skin, Fresh & Pure, among others. These are backed by a nation-wide network of sourcing centres for agricultural produce and state-of-the-art manufacturing facilities at India Food Park, Tumkur and other locations across India and Sri Lanka. The Company ‘s products include processed and frozen food, dairy and bakery items, juices, snacks, biscuits and basic food items such as rice, wheat, spices, pulses, oats and sugar etc.

Incorporated in 2014, Athena Life Science Private Limited (“ALSPL”) is inter alia engaged in the business of marketing, selling and distribution of fast-moving consumer goods and services in the cosmeceutical and healthcare space., Some of its brands include ’Iraya', ’D ‘Free ', ‘Hair for Sure ', ‘Safe and Sure ', ‘Just for Moms ', ‘Fab Fit’ etc.

Transaction:

With the appointed date as 1^st April 2019, FCL will acquire “Identified Business” undertaking of ALSPL. The “Identified Business” undertaking includes marketing, selling and distribution business of the brands like ‘Iraya’, ‘D’Free', “Hair for Sure’, and ‘Safe & Sure Q”
Detailed description of the Identified Undertaking:

D'Free: D'Free is a unique, leave on lotion that is superior and different from the current approaches of treating Dandruff, viz - shampoos.

Hair for Sure: Hair for Sure 15 clinically proven Hair Tonic that helps to treating consumers in early stages of Androgenic Alopecia.

Safe & Sure: Safe and Sure is a brand under development to enter the fast-growing female hygiene segment including products like Sanitary Napkins, etc.

lraya: Iraya operates in the fast-growing space of Premium Ayurvedic products. With a portfolio of over 240 products in both retail and professional salon segments, Iraya's unique approach to formulations and focus on quality, makes it a leading name in Premium Ayurvedic Cosmetics.

Shareholding Pattern

Future Consumer Limited

Athena Life Science Private Limited
Almost all the shares of Athena Life Science Private Limited are held by the High Net worth Investors. Post-demerger, they will get the equity shares in FCL.

Swap Ratio:

13 (Thirteen) fully paid-up equity shares of face value INR 6 each of FCL will be issued for every 83 (Eighty-Three) equity shares of ALSPL

As a result of the demerger, around one crore shares will get issued to the existing shareholders of ALSPL which is meagre in front of total equity share capital of FCL. Post-demerger, ALSPL’s shareholder will hold circa 0.5% stake in FCL.

Changes in Shareholding pattern of ALSPL:

In FY 2015-16, Enam group entered company by subscribing to the equity shares of the company.  At the end of FY 2016, Athena Family Trust (“Promoters of Athena”) was holding ~67% stake & ~20% stake was held by Enam Group in the Company. In 2017, additional shares got issued to financial partners and promoters. Further, maybe as a part of marketing strategy, warrants & 100 equity shares got issued to Bennett Coleman and Company Limited.

In FY2019, Athena Family Trust sold its entire stake (except for 100 shares) to financials partners. The company issued 10,67,571 equity shares in tranches at INR 46.52 per share & 1,97,00,000 equity shares at INR 10 each. Further, the Company also converted warrants into equity shares and sold by Bennett Coleman and Company Limited. In the same year, the Company shifted its register office from Ahmedabad to Mumbai.

Consolidation in Retail Industry

Over the last two decades, the Indian retail industry has seen significant changes, evolving rapidly from traditional shops to large multi-format stores offering a global experience. The rapidly changing dynamics resulted in unprecedented growth in overall consumption with numbers suggesting that consumer expenditure in India is expected to almost double to $3,600 billion by 2020 from $1,824 billion in 2017.

Kishore Biyani led Future Group has gone through a lot of restructuring in the past. It started with the demerger of the retail business in 2015 and further separating the home retail business in 2017 and focusing on the consumer retail business.

Financials

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