RIL has also sent a notice to the resolution professional (RP), claiming about ₹5,300 crore as money owed by the Future Group flagship, they said.
Adani Airport Holding Ltd and Flemingo Group have formed a joint venture, April Moon Retail, which has submitted the EoI, said the people cited above. EoIs have also come in from DS Group, Dickey Alternative Investment Trust, SNVK Hospitality,
, a B Right Real Estate-Ayekart Fintech consortium, WHSmith Travel, United Biotech, Bommidala Enterprises, Steel and Power, Gordon and Payard, UV Multiple Asset Investment Trust, Shalimar Corporation and a consortium led by Bhumireddy Gari Mohan Reddy, they said.
The Future Retail RP said the final list of prospective bidders will be announced on November 20. Resolution plans must be submitted by December 15, which will be a binding bid.
Rent & Inventory Dues
Future Retail owns store brand names such as Big Bazaar, Foodhall and Easy Day, among others. It currently operates about 300 stores – 30 large format and 272 small-format ones – though footfall has dropped drastically due to poor inventory and lack of warehouse space.
didn’t respond to queries. Adani Group didn’t respond to queries as of press time. The dues to Reliance are pending lease payments after it became the lessee in 2021 of more than 950 retail locations that were sub-let to Future to run its stores, for inventory supplied and working capital loans it extended in FY21 and FY22. Of this, over Rs 4,000 crore is for rent receivables and the inventory supplied, said the people cited above.
“Reliance is one of the unsecured creditors of Future Retail and, hence, it has sought a claim over the amount in the interim resolution process,” said one of the persons. “The notice has been sent recently. The company has also placed an EoI for Future Retail as it has been keen to acquire the assets ever since it made the offer to buy out the business in 2020.”
As of September 27, the resolution professional had got claims of over Rs 21,450 crore from financial creditors, which mainly include banks and financial institutions; Rs 3,064 crore from operational creditors like supplier brands; and over Rs 272 crore from statutory creditors, employees and other creditors, according to latest documents uploaded on the Future Retail website.
Legal Wrangle
Reliance Retail Ventures, a subsidiary of Reliance Industries, in August 2020 announced its plan to acquire the retail, wholesale, logistics and warehousing business of Future Group for Rs 24,713 crore.
However, US ecommerce giant Amazon, an investor in one of the Future Group holding companies, opposed the deal in court over alleged breach of shareholder contract. In April, the secured creditors (banks and financial institutions) of Future Group opposed the deal, following which, Reliance called it off after extending the deadline thrice.
After the deal was announced, Reliance had provided financial help to Future to run the business. But in February, Reliance shuttered over 950 Future Retail stores after the latter defaulted on rent payments for these locations.
Reliance then started its own stores under new brands at the same locations. Future Group’s hypermarket Big Bazaar was rebranded Smart Bazaar, Central mall became Centro, and Brand Factory became Fashion Factory.
Reliance became the tenant of these locations in early 2021, when the Future Group defaulted on rent payments to landlords. Subsequently, Reliance sub-let these locations to Future Group.
Reliance also helped Future with money to buy stock for its stores and working capital. Future Group has used the cash generated from sales for running the business and settling some outstanding payments, including employee salaries, industry executives said.
