Blackstone invests Rs 1,750 crore in Future Lifestyle Fashion

Blackstone, the world’s biggest private equity firm, has invested Rs 1,750 crore in Future Lifestyle Fashion (FLF), the flagship fashion business of Kishore Biyani-owned Future Group. Funds managed by Blackstone will invest in Ryka Commercial Ventures, the holding company of the lifestyle retailer through debentures which will be used to retire or pre-close all existing financial obligations, Future Group said.

"Blackstone will support us in the continued growth of our fashion business, bringing global perspectives that will help us take FLFL to the next level,” said Kishore Biyani, Group CEO of Future Group.

In July this year, Blackstone had acquired about 6 per cent stake in FLF for about Rs 545 crore in a secondary market transaction. Biyani and family own 53.43 per cent of FLF through entities such as Ryka Commercial Ventures, Central Departmental Stores and Future Enterprises among others. Other investors in FLF include L Catterton and PremjiInvest, which together own around 17 per cent, L&T Mutual Fund that owns 4 per cent, and LIC with 6.5 per cent stake.

“This is our first investment in this sector. We look forward to being a value-added investor as FLFL and the Future Group continue to cater to the fashion needs of aspiring India,” Luv Parikh, managing director, Blackstone said.

ET in July had reported that Blackstone will infuse capital in FLF through a combination of equity and structured debt that will fund the capital expansion of Biyani’s deep-discount retail format Brand Factory, which is modelled on US retailer TJ Maxx, besides improving his promoter-level leverage. Future Group generates its biggest chunk from food and grocery retailing, but the apparel and lifestyle segment is a higher margin business for it. FLF grew 27 per cent last fiscal with revenues of Rs 5,728 crore. The firm also manages nearly 30 brands including Indigo Nation and Lee Cooper, through 339 stores across 7.2 million square feet of retail space.