Troubles mount for Vishal Retail

Ram Chandra Agarwal, founder and managing director of Vishal Retail Ltd., said that he is prepared to step down as the head of the company if that helps the beleaguered retailer. "I am agreeing to anything that is in the benefit of the company, including stepping down," he said. Vishal Retail has been posting losses over the last three quarters amid an economic slowdown that has hit retailers hard. Agarwal also said that he was also prepared to dilute an unspecified stake from his share of 63% in Vishal Retail to pave the way for any investor. Reports said that private equity firm TPG has evinced interest in acquiring a majority stake in Vishal Retail, which has gone in for corporate debt restructuring (CDR). Investment banking sources said TPG has made a Rs2.5bn offer for the stake held by Vishal Promoter and Chairman Ram Chandra Agarwal before the CDR cell. Agarwal and other promoters hold 60.23% stake in the company. The TPG proposal values the beleaguered apparel retailer at Rs4.17bn. The Mumbai-based CDR cell is holding talks with lenders as part of Vishal Retail’s debt recast. After the joint lender meeting (JLM) remained inconclusive on January 30, the next JLM is scheduled next week. According to reports, Mumbai-based Wadhawan Group may also join the race to acquire a controlling stake in Vishal Retail, though it has not submitted any proposal as of now.