Breaking: Reliance calls off deal with Future Retail

Following disagreement from FRL’s secured creditors, Reliance Industries Ltd (RIL) has canceled a proposed transaction with Future Retail Ltd (FRL).

“The Future Group companies including Future Retail Ltd (FRL) and other listed companies involved in the scheme have informed the results of the voting on the scheme of arrangement by their shareholders and creditors at their separate meetings,” RIL stated in a filing with the stock markets.

“FRL’s shareholders and unsecured creditors voted in favor of the scheme based on these results.” “However, FRL’s secured creditors voted against the scheme,” according to the announcement.

“As a result,” it continued, “the subject scheme of organization cannot be executed.”

Reliance had informed the stock exchanges on August 29, 2020, about a scheme of arrangement for the transfer of Future Group’s retail and wholesale businesses, as well as its logistics and warehousing businesses, to Reliance Retail Ventures Ltd (RRVL), its subsidiary, and Reliance Retail and Fashion Lifestyle Ltd (RRFLL), a wholly-owned subsidiary of RRVL, for a total consideration of Rs 24,731 crore.

Amazon Inc., which had previously invested in Future Coupons, had vigorously opposed the transaction and challenged it in India’s Supreme Court. The Singapore Arbitration Tribunal had also issued an injunction.

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