Vishal scrip rises 4% on TPG offer

Vishal gains in scrips and decides to dispose off its assets

Discount-retailer Vishal Retail's share price gained over 4% Tuesday on reports that its corporate debt restructuring (CDR) lenders have approved private equity firm Texas Pacific Group (TPG) Capital's revised offer to acquire the assets of the company.


Over 10 lakh shares were traded in the counter, four times its two-week average. On Tuesday’s closing, the company's market capitalisation stood at Rs 126 crore. Total outstanding debt on the balance sheet is Rs 730 crore.


In another news, Vishal Retail Ltd, which is in the final stages of selling its assets to TPG Capital Lp, has started the process of intimating the landlords of its stores of an ownership change in the company.

Landlords are being intimated through emails and telephone calls that their lease agreement will transfer to TPG even as the earlier terms of the agreement will remain the same, a person close to the situation said.


Vishal Retail promoter and outgoing managing director Ram Chandra Agarwal called a meeting of all the nine regional managers of the company and told them to initiate the process with the owners of 130 stores nationwide.


Vishal Retail’s latest move comes a day after the corporate debt restructuring (CDR) committee approved the US-based private equity firm’s revised proposal to acquire the assets of the troubled retailer. The main lenders of Vishal Retail, including State Bank of India, HDFC Bank Ltd and ING Vysya Bank Ltd, are part of the debt recast.


Vishal Retail was one of the Indian retail chains that were severely hurt by a economic slowdown, joining casualties such as Chennai-based discount retailer Subhiksha Trading Services Ltd and the India master franchisee of US-based My Dollar Store Inc.


TPG was the lone suitor for Vishal Retail until the parent company of the country’s largest listed retailer Pantaloon Retail (India) Ltd also jumped into the fray. The CDR committee approved TPG’s revised proposal on Monday.