Reliance Industries (RIL)'s subsidiary Reliance Retail Ventures (RRVL) said it is acquiring the retail & wholesale business and the logistics & warehousing business from the Future Group as going concerns on a slump sale basis for Rs 24713 crore.
The announcement was made on Saturday, 29 August 2020. Shares of RIL rose 0.18% to settle at Rs 2,115.60 on Friday.
The acquisition is subject to adjustments as set-out in the composite scheme of arrangement (Scheme). The acquisition is being done as part of the Scheme in which Future Group is merging certain companies carrying on the aforesaid businesses into Future Enterprises (FEL).
RIL said that the acquisition of the retail, wholesale and supply chain business of the Future Group complements and makes a strong strategic fit into Reliance's retail business. This will help Reliance retail to accelerate providing support to millions of small merchants in increasing their competitiveness and enhance their income during these challenging times. Future Group's portfolio composition in apparel, general merchandise and own FMCG brands will allow for a wider offering to its customers. This acquisition is subject to SEBI, CCI, NCLT, shareholders, creditors and other requisite approvals, RIL said.
As a part of the same Scheme - the retail and wholesale undertaking is being transferred to Reliance Retail and Fashion Lifestyle (RRFLL), a wholly-owned subsidiary of RRVL; the logistics and warehousing uUndertaking is being transferred to RRVL; and RRFLL also proposes to invest - Rs 1,200 crore in the preferential issue of equity shares of FEL to acquire 6.09% of post-merger equity; and Rs 400 crore in a preferential issue of equity warrants which, upon conversion and payment of balance 75% of the issue price, will result in RRFLL acquiring further 7.05% of FEL.
RRVL is a subsidiary of RIL, carrying on the Consumer Supply Chain Business and Consumer Retail Business through its subsidiaries.
Isha Ambani, Director, Reliance Retail Ventures, said the company hopes to continue the growth momentum of the retail industry with unique model of active collaboration with small merchants and kiranas as well as large consumer brands.
RIL is India's largest private sector company. RIL's activities span hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, retail and digital services.
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