Pantaloon Retail’s debt will come down by Rs 3,600 crore (Rs 36 billion) to Rs 1,900 crore (Rs 19 billion) by the end of the June quarter, said an executive with the Future group, the parent of Pantaloon Retail.
By then, the company will have completed the transaction of stake sale of insurance business (Future Generali India Insurance) and de-merger of its fashion subsidiary (Future Lifestyle Fashions).
The company’s total debt is Rs 5,500 crore (Rs 55 billion) as of December 31, 2012.
Along with the sale of Pantaloon to Aditya Birla Nuvo, a debt of Rs 1,600 crore (Rs 16 billion) will also be transferred to the latter.
Plus, the de-merger and listing of Future Lifestyle Fashion is expected to shift another Rs 1,200-crore (Rs 12-billion) debt to the new company.
The listing is likely to take place by the June quarter, said the executive.
The sale of Future Generali, a joint venture between the Future Group and Italy’s Generali, to L&T and Generali, will also reduce debt by another Rs 800 crore (Rs 8 billion).
The sale is also likely to complete by June quarter, according to the executive.
“By end of the current financial year, we will be a Rs 9,800-crore (Rs 98-billion) company with an Ebitda (earnings before interest, taxes, depreciation and amortisation) of Rs 700-800 crore (Rs 7-8 billion) and assets of Rs 2,500 crore (Rs 25 billion),” he said.
Kishore Biyani, managing director of the company, could not be contacted for comments.
Pantaloon holds 10 per cent stake in Capital First (formerly Future Capital Holdings) and 19 per cent in Future Lifestyle Fashions.
“With sale of stake in insurance arms, we are done with divestments.
"We do not have immediate plans of selling anything.
"We will look at selling residual stakes in some of the investments in case of private placement or anything else.” said the executive.