TRENT Ltd., the retail venture of Tatas, today announced that it has acquired a 76 per cent "strategic interest" in the Chennai-based privately owned books and music retailer Landmark and its subsidiary firms, for a consideration of Rs 103.6 crore.
Ms Hemu Ramaiah, who created the brand Landmark with the launch of the retail chain's first store in Chennai in 1987, will continue to be the CEO of Landmark, says a Press release from Trent. Her brother, Mr Natraj Ramaiah, and one of the main promoters of the chain, will exit the partnership firm, having sold his 75% stake in an all-cash deal. Ms Ramaiah has sold one per cent of her shareholding and will continue to hold the balance 24 per cent in Landmark.
With the Trent acquisition, a new company, christened Landmark Mega Stores Pvt Ltd, will be established.
Mr Ramaiah is the MD of Korea Lanka Garments Pvt Ltd, a garment export company in Sri Lanka, which belongs to Sri Krishna Corporation, an industrial and trading house. Business Line on Tuesday had reported that the Trent-Landmark deal was in the offing.
Landmark (including its subsidiary firms) closed FY '05 with a turnover of Rs 95 crore which is projected to increase to Rs 130 crore in the current year.
The chain now has four own stores (three in Chennai and one in Bangalore) and operates in Kolkata through a joint venture with the Emami group. Its stores range in size from 12,000 sq ft to 45,000 sq ft and stock various categories of merchandise such as books, audio/video, gifts, stationery, cards and toys.
Commenting on the development, Mr Noel Tata, Managing Director, Trent Ltd, said, "We are happy to be partnering in the growth strategy of Landmark. Landmark has one of the finest retail concepts in India and we see significant synergies in this partnership." Trent at present operates two formats: Westside and Star India Bazaar. Westside has a national presence with 18 stores and Star India Bazaar launched its first hypermarket recently in Ahmedabad.
Speaking to Business Line, Ms Ramaiah said that a few considerations necessiated the stake sale: to fuel expansion of Landmark, to corporatise the chain, and also to offer an exit option for the future. The deal with Trent was structured by Veda Corporate Advisors Pvt Ltd.
Ms Ramaiah said that now the Landmark chain will look to gain a pan-India presence from the predominantly southern base that it has. It is planning one more store at an upcoming mall in Chennai and later in Bangalore, Mumbai, Pune and Delhi.
Shares of Trent on Tuesday closed higher on the NSE at Rs 902.70, up from Rs 826.70 on Monday.