Future Group, in the race for taking over debt-ridden Vishal Retail, has laid down certain conditions in its proposal to the lenders, a senior official in the know of the loan restructuring process said.
The company has put a clause in the proposal which, if approved by the parties concerned, would require Vishal Retail to change its name. Vishal would have to discontinue any business under the brand name ‘Vishal’ or ‘Vishal Retail.’ The retail giant has also proposed legal due diligence — by a third party appointed by Future Group — of properties and physical verification of fixed assets and net current assets. In case the value of net current assets of Vishal Retail is lower than Rs 25 crore, then Future Group would terminate the transaction after discussions with the former’s promoter. Approval of the unsecured lenders is also a pre-requisite for the transaction to get through.
Future Group has been in discussions with the promoters of Vishal and wants to take over the business of the company, including its stores, trademarks, intellectual property rights, leases, inventory and employees, through an agreed mechanism. The lenders are still to decide between the proposals of TPG group and Future Group to finalise the corporate debt restructuring. In the previous meeting, the banks could not come to an agreement. No date has been fixed for the next meeting. However, informal meetings will be held between the parties and individual banks to study the options, a banker said.
