The electronic voting process for shareholders of the debt-ridden Future Retail Ltd (FRL) ended on Tuesday evening ahead of the meetings of the shareholders and creditors to approve the sale of the company's retail assets to billionaire Mukesh Ambani's Reliance Retail despite opposition from e-commerce major Amazon and an insolvency petition from its lenders.
As per an addendum notice that the company had submitted to the BSE, FRL's remote e-voting for its equity shareholders started last week on Saturday morning and was scheduled to end at 5 pm on Tuesday. The voting was for approval of the scheme entailing Rs 24,713 crore deal by the Kishore Biyani-led Future group to sell its retail, wholesale, logistics and warehousing segments to Reliance Retail Ventures Ltd (RRVL).
FRL has scheduled meetings of equity shareholders, secured creditors and unsecured creditors of the company on April 20 and 21, 2022, respectively as per directions of the Mumbai Bench of the National Company Law Tribunal (NCLT).
The meetings have been vehemently opposed by Amazon, which is contesting FRL's deal with RRVL.
In a strongly-worded letter to Kishore Biyani and other promoters of FRL, Amazon, last week, said it was "illegal" and such a step would not only breach 2019 agreements when it made investments into FRL's promoter firm but also violate a Singapore arbitral tribunal's injunction on the sale of retail assets to Reliance.
However, FRL had rejected the allegations and said the meetings are "in compliance of the directions" issued by the NCLT on February 28, 2022 to consider and approve the Scheme of Arrangement filed by various entities, who are part of the deal.
In a regulatory update on April 16, FRL said, "the said order has been issued by the NCLT, after considering all the facts and information submitted by the parties and specific objections filed by Amazon.Com NV Investment Holdings LLC vide an intervening application and the order dated 15th February 2022 issued by Supreme Court on the same subject matter".
Last week, public sector lender Bank of India (BOI) moved NCLT seeking initiation of insolvency proceedings against FRL and a moratorium over the assets of the Kishore Biyani-led debt-ridden firm.
Besides, BOI, the lead banker of a consortium of banks that lent money to FRL, suggested the insolvency tribunal to appoint Vijay Kumar V Iyer as the interim resolution professional of the company.
Over the matter, FRL had said it has been served and received a copy of the petition and is in the "process of taking legal advice".
Earlier this month, FRL reported defaulting on payment of Rs 5,322.32 crore to its lenders on account of the ongoing litigations with Amazon and other related issues.
Amazon is opposed to Reliance's August 2020 offer to buy FRL's stores and warehouses for Rs 24,713 crore on grounds that the deal violated its 2019 agreement through which it acquired a 49 per cent stake in FCPL, the promoter entity of FRL, for about Rs 1,500 crore.
It has dragged Future to arbitration and in courts to block the Reliance deal.
In late February, Reliance quietly began taking over the rental leases of hundreds of stores once run by FRL and Future Lifestyle Fashions Ltd amid lawsuits and arbitration across India and Singapore.
FRL is part of the Rs 24,713 crore deal announced by Future Group in August 2020, under which it is to sell 19 companies operating in retail, wholesale, logistics and warehousing segments to RRVL.
All 19 companies would be consolidated into one entity -- Future Enterprises Ltd -- and then transferred to RRVL under the proposed deal.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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