The National Company Law Tribunal (NCLT) passed an order allowing Future Group companies to convene meetings of its shareholders and creditors to seek their approval for the scheme. It was signed in 2020 that allows Future Group to sell its retail, logistics, and warehousing businesses to Reliance Retail for about Rs 25,000 crore.
The companies are — Future Consumer, Future Lifestyle Fashions, Future Market Networks, Future Retail, Future Supply Chain Solutions, and Future Enterprise Ltd.
In September 2021, the tribunal (NCLT) had allowed creditors and shareholders to hold meetings over the deal. Following this Amazon filed a petition objecting to such a meeting of creditors and shareholders of Future Group. This petition has been dismissed by NCLT.
Amazon has been opposing Future Group’s deal with RIL since October 2020. In 2019, the US e-commerce major acquired a 49 per cent stake in Future Coupons, the promoter entity of Future Retail, for about Rs 1,500 crore.
“The schedule of the meetings of shareholders and creditors will be intimated in due course of time,” Future Retail said in a stock exchange filing.
About Deal
However, the deal could not be closed as Future’s warring partner Amazon went to courts citing violation of some contracts. Future denies any wrongdoing.
After the deal was stuck in a series of litigations and arbitrations, the long-stop date for the Scheme has already been extended by six months to 30th September 2022 by Reliance. FRL had informed last week.
This is the third extension of the timeline by Reliance Retail Ventures Ltd (RRVL). The retail arm of Reliance Industries, for completing its Rs 24,713 crore deal with the Future group.
Earlier, RRVL had extended the timeline from September 30, 2021, to March 31, 2022. The first long stop date was March 31, 2021, which was extended to September 30, 2021.
RIL will open most of the 200 Future Retail stores as Reliance stores in the next week. It is in the process of taking stock, re-branding and transferring 30,000 Future Retail. Future Lifestyle employees onto the rolls of Reliance SMSL, its manpower, and staffing firm.
Reliance Takeover
Earlier during the week, Future Retail said it was committed to getting back the hundreds of stores that were taken over by the Reliance Group and claimed that the “drastic and unilateral action” taken by Reliance had come as a surprise.
In a regulatory filing, FRL said its board has taken strong objection to such action by Reliance Group. It has put it on notice to reconsider all other actions initiated over the last few days.
In an earlier filing this month, FRL had said that Reliance Retail, a subsidiary of Reliance Retail Ventures (RRVL). It issued notices to terminate sub-leases of 947 stores of Future group. It plans to take over and rebrand.
The company has received termination notices for 342 large format retail stores. It includes Big Bazaar, Fashion at Big Bazaar, and 493 small format retail stores such as easy day and Heritage stores. Further, another group company Future Lifestyle Fashions said it received termination notices for 34 ‘Central’ stores and 78 ‘Brand Factory’ stores of the company.
These stores – LFR, small retail, ‘Central’ and ‘Brand Factory’ – have been contributing about 55%-65% of the company’s total retail revenue from operations.
Reliance was also to also absorb the entire 30,000 staff of Future Retail and Future Lifestyle, including the employees of the remaining stores. Future Retail and Future Lifestyle together have 1,700 stores, including the popular Big Bazaar stores.
