On Tuesday, the National Company Law Tribunal (NCLT) reserved its order in the petitions filed by Retail Retail entities to hold meetings of their shareholders and creditors to consider and approve the proposed merger with Future Group’s retail, logistics and warehousing business in a Rs 24,713 crore deal.
The scheme or merger envisages a merger of Kishore Biyani owned companies into Mukesh Ambani owned Reliance Group’s two companies Reliance Retail Ventures Ltd (RRVL) and Reliance Retail Fashion Lifestyle Limited (RRFLL).
Reliance Retail is seeking NCLT’s approval to convene a shareholders meeting on Aug 3 to get a consensus on the deal.
The division bench of NCLT, preceded by a judicial member Suchitra Kanuparthi and a judicial member Rajesh Sharma, asked if the lenders to Future Retail were on board with the whole scheme and reserved the order after hearing.
“There are two business, retail and logistics, and this is a composite scheme where 19 transferor companies will transfer to Future Enterprises Ltd (FEL), and in turn, FEL will transfer its retail business to RRVL and RRFLL,” argued senior counsel Janak Dwarkadas while appearing for the RIL subsidiaries.
However, the e-commerce major Amazon, opposing the deal, has objected to this move at the tribunal.
Amazon indirectly owns a 5% stake in Future Retail Ltd (FRL) — which houses all food and grocery stores such as Big Bazaar, HyperCity, Easyday and Nilgiri’s — through a 49% stake in promoter holding firm Future Coupons that it bought for Rs 1,500 crore in 2019.
“Every step in the transaction is prejudice to me,” argued Senior Advocates Arun Kathpalia while appearing for the Amazon and opposed Reliance Retail’s plea to seek the tribunal’s approval to hold meetings of their shareholders and creditors to consider and approve the proposed merger with Future Group’s retail, logistic and warehousing business.
The Future Group has also separately moved to the NCLT, seeking its permission to call its shareholders to approve the deal. However, the tribunal has reserved its orders over its plea.
Currently, the dispute between Amazon and the Future Group is being contested at the Supreme Court and Singapore International Arbitration Centre (SIAC).
Though the Supreme Court has granted a go-ahead to the NCLT for its proceedings, it has asked the tribunal not to pass any final order sanctioning the scheme.
