Future Enterprises will subsequently sell by way of a slump sale the retail and wholesale business that includes key formats such as Big Bazaar, fbb, Foodhall, Easyday, Nilgiris, Central and Brand Factory to Reliance Retail and Fashions Lifestyle (RRFLL), a wholly owned subsidiary of Reliance Retail Ventures (RRVL). It will also sell the logistics and warehousing business to RSVL by way of slump sale. RRFLL and RRVL will take over certain borrowings and current liabilities related to the business and discharge the balance consideration by way of cash.
After this transaction, Future Enterprises will retain the manufacturing and distribution of FMCG goods and integrated fashion sourcing and manufacturing business and its insurance JVs with Generalli and JVs with NTC Mills.
RRFLL, as part of this transaction, will also invest (I) a sum of Rs 1200 crore in the preferential issue of equity shares of Future Enterprises for a 6.09% stake, and (II) Rs 400 crore in warrants convertible into equity shares, which when converted upon payment of balance 75% consideration will result in RRFLL acquiring a further 7.05% stake.
Post this transaction, Future Enterprises will emerge strong with businesses in manufacturing and distribution of FMCG products and integrated fashion souring and merchandising. Theses business will future benefit from supply agreement with RRFLL. This deal will also enable Future Enterprises to focus on creation of new age brands in FMCG and fashion space and expand its reach.
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