FMCG major Godfrey Phillips has signed a term sheet for the sale of its retail business, 24Seven, to retail startup New Shop, according to CNBC-TV18. The deal, expected to be finalized by the end of September, will see the transfer of 24Seven’s stores to New Shop, which operates around the clock in 35 cities with 160 stores.
The decision to sell 24Seven comes after the Delhi High Court allowed Godfrey Phillips to proceed with the sale earlier this year. This move follows internal opposition from Executive Director Samir Modi, who is embroiled in an inheritance dispute with Godfrey Phillips’ Managing Director, Bina Modi.
Godfrey Phillips, established in 1936 and known for cigarette brands such as Four Square, Red & White, and Cavanders, diversified into the retail business in 2010. This strategic shift aimed to reduce the company’s dependence on its tobacco operations and capitalize on the burgeoning consumption market. As of the latest reports, 24Seven operated over 150 stores across Delhi NCR, Punjab, and Telangana, generating gross sales of Rs 484 crore.
Despite these efforts, 24Seven struggled with continued losses. On April 12, 2024, the board decided to exit the retail business after evaluating the long-term performance and feedback from stakeholders.
Shares of Godfrey Phillips have experienced a significant rise, up more than 200 percent year-to-date, reflecting positive market response to the company’s strategic decisions.