Kishore Biyani-led Future Group is set to buy a 30 percent stake in online fashion retailer Koovs.com, according to a reportby The Economic Times.
The move comes as a fresh attempt to crack the Indian e-commerce fashion market after the company’s unsuccessful bid to buy Jabong.com in 2016.
The stake will be purchased by the group’s subsidiary Future Lifestyle Fashion for about Rs 140 crore, making it the largest shareholder in the London-listed fashion e-commerce company.
Koovs sells its private labels and curated fashion and lifestyle products.
“We like their (Koovs) positioning as they are high on curated fashion and we can bring synergies Online fashion has taken off in India and we think we can make Koovs big and viable,” Biyani told the newspaper.
“It gives us a platform to sell our other existing portfolio,” he added.
Koovs will issue Future Lifestyle 5,78,76,600 new ordinary shares at a price of 10 pence per share, representing 24.8 percent of the enlarged issued share capital, raising 5,787,660 pounds in cash, according to the report.
“The transaction will be done in two phases and will also involve other investors making further investments in the entity,” a person familiar with the development told the newspaper.
Koovs targets the 18-34 years old age group with curated fashion and lifestyle products from multiple international brands. Around 40 percent of the company’s sales comes from its private labels. The company at present has a revenue of about Rs 200 crore, the report suggests.
A person aware of the deal told the newspaper that the Kishore Biyani-led company would use proceeds from a recently concluded stake sale. The company had sold 10 percent stake in LVMH Moet Hennessy Louis Vuitton-owned private equity fund L Catterton Asia for about Rs 900 crore in May.[“Source-moneycontrol”]