- India’s Future Group Ltd is all set to finalize Saturday’s sale of the group’s retail business to the retail arm of Mukesh Ambani-led Reliance Industries Ltd, The Economic Times said.
India’s Future Group Ltd is all set to finalize Saturday’s sale of the group’s retail business to the retail arm of Mukesh Ambani-led Reliance Industries Ltd, The Economic Times said.
According to various media sources, the contract, reportedly in the works for months now, has been priced at approximately ~29,000- some 30,000 crores. The Economic Times said on Friday that Reliance would take on the debt and liabilities of Future Group and pick up a minority stake in the consumer’s arm, citing two sources familiar with the matter.
Owned by India’s “father of modern retail,” Kishore Biyani, Future Group is home to the Big Bazaar supermarket chain, Foodhall upmarket grocery shops, and Brand Factory bargaining clothing chain.
The Company will combine five listed entities into Future Enterprises around the food, clothing, supply chain, and consumer market, which will then hive off all retail assets and sell them as a single entity to Reliance, the report said.
Earlier this week Future Enterprises had said it would meet on Saturday to discuss plans to collect funds via a bond issue.
Driven by Asia’s richest man Mukesh Ambani, Reliance diversified its market and ramped up a presence in the retail sector. It launched a JioMart online grocery service in May, a development that rivals Amazon.com Inc and Flipkart of Walmart Inc Ltd in India, a key rising e-commerce market.
The company is also in talks to buy Urban Ladder online furniture company and Milk delivery startup Milkbasket to reinforce its e-commerce market, the Times of India said earlier this month.
Future Enterprises Ltd’s shares have jumped 5 percent and exceeded an upper price cap.
The selling of Future Retail’s controlling stake to Mukesh Ambani’s RIL is seen as the biggest setback to Biyani, considered as one of India’s best business minds. Over the years the Future Group has accumulated heavy debt. As of 30 September 2019, debt at the listed entities of Future Group rose to Rs 12,778 from Rs 10,951 crore as of 31 March 2019. He had the deadline for repaying some of those dues in March. Yet loan moratorium from India’s Reserve Bank has given a breather.