Debt-ridden Future Consumer Ltd on Tuesday announced the sale of its dairy business Nilgiri Dairy Farm to AVA Cholayil Healthcare for a total consideration of INR 67 crore. As per the deal, Future Consumer has entered into a “transfer agreement for the transfer of entire business undertaking of ‘The Nilgiri Dairy Farm Pvt Ltd (NDFPL)”.
This encompasses its franchise operations, retail trading activities, as well as the sourcing, processing, packaging, and promotion of its dairy items, bakery goods (excluding the cookie plant), fast-moving consumer goods, essential commodities, and other merchandise.
This monetization endeavor will provide assistance to Future Consumer Ltd (FCL). FCL operates within the domain of producing, branding, and distributing FMCG food and processed food items. The company has also encountered numerous instances of non-payment, involving both the principal and interest amounts due on NCDs.
During a meeting convened on Tuesday, the board of the FMCG division of the Future Group sanctioned the transaction involving the sale of NDFPL business to AVA Cholayil Healthcare. AVA Cholayil Healthcare operates in the realm of producing, promoting, and distributing personal care and food items, while also overseeing a network of wellness clinics and hospitals.
The purchase consideration of INR 67 crore shall be paid in three tranches on meeting certain conditions.
However, the deal will be “subject to obtaining of all necessary consents and approvals including that of the Lenders and Shareholders of the Company in accordance with applicable laws and regulations,” it added.
NDFPL is involved in the manufacturing, marketing, and distribution of dairy and bakery products. Additionally, the company procures a range of FMCG and essential products for distribution and sale to specific retail outlets operating under its franchise network.
The turnover of NDFPL stood at INR 39.65 crore, accounting for 10.40 percent of the combined turnover of Future Consumer.
Back in 2014, FCL acquired NDFPL along with its subsidiary Nilgiri’s convenience store chain, in a transaction valued at approximately INR 300 crore.