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Reliance Retail buys Future Group's retail, supply chain and other business for Rs 24,713 cr Reliance Retail

Reliance Retail buys Future Group's retail, supply chain and other business for Rs 24,713 cr

India Blooms News Service | @indiablooms | 29 Aug 2020, 09:58 pm

Mumbai/IBNS: Reliance Retail Ventures Limited (RRVL), a subsidiary of Reliance Industries led by billionaire Mukesh Ambani, Saturday announced that it is acquiring the retail and wholesale as well as logistics and warehousing businesses of the Future Group for Rs 24,713 crore as going concerns on a slump sale basis, according to media reports.

The transaction is subject to regulatory and shareholder approvals, it said, adding that it is part of the scheme in which Future Group is merging certain group companies into Future Enterprises Limited (FEL).

The acquisition of the retail and wholesale as well as supply chain businesses is strategically aligned with its retail business, Reliance Industries said.

"With this transaction, we are pleased to provide a home to the renowned formats and brands of Future Group as well as preserve its business ecosystem, which have played an important role in the evolution of modern retail in India," said Isha Ambani, director, Reliance Retail Ventures.

"We hope to continue the growth momentum of the retail industry with our unique model of active collaboration with small merchants and kiranas as well as large consumer brands. We are committed to continue providing value to our consumers across the country," she added.

The Retail & Wholesale Undertaking acquired from the Future Group will be transferred to Reliance Retail and Fashion Lifestyle Limited (RRFLL), a wholly-owned subsidiary of RRVL.

The Logistics & Warehousing Undertaking is being transferred to RRVL, and  RRFLL also proposes to invest Rs 1,200 crore in the preferential issue of equity shares of FEL to acquire 6.09  per cent of post-merger equity.

Another Rs 400 crore would be invested in a preferential issue of equity warrants which, upon conversion and payment of balance 75% of the issue price, will result in RRFLL acquiring further 7.05% of FEL.

This will help Reliance retail to accelerate providing support to millions of small merchants in increasing their competitiveness and enhance their income during these challenging times, RRVL statement said.