In early April’22, Bank of India had approached NCLT against Future Retail Group. National Company Law Tribunal (NCLT) – On Thursday the 28th April, Mumbai bench adjourned the insolvency proceedings filed against FRL by Bank of India under Section 7 of Insolvency and Bankruptcy Code (IBC) to May 12 based on the request raised by FRL. Earlier this month, RIL had cancelled its proposed acquisition deal with Future Retail Group after secured creditors voted against it. This deal was announced in August 2020 by RIL in order to acquire through its subsidiary Reliance Retail Ventures Limited (RRVL) the Future Group companies operating in retail, wholesale, logistics and warehousing segments.
Who will bell the cat named FRL?
The question remains on the top leaving just a few options now – Amazon or other interested party may come-in and even chances of Reliance coming back again with its new acquisition plan or strategy.
Listing down the chain of events that lead FRL Group to this stage today.
| WHO | WHAT | WHEN and HOW |
| FRL | Open to sell | After getting caught-up in heavy debts, FRL Group’s 19 companies in retail, wholesale, logistics and warehousing segments risked its continuity as going concern. |
| RIL through subsidiary RRVL | Ready to acquire | RIL announced in August 2020 its acquisition plan for taking over FRL (Deal size Rs 24713 Crores) |
| Amazon | Interested to buy FRL Group, but failed | Amazon tried acquisition of FR Group but could not succeed due to technical issues. |
| RIL took over land for FRL Stores through Reliance Projects & Property Management | RIL got good number of FRL Stores indirectly | RIL tapped an opportunity to take-over lease from land-owners and sub-let the same to around 800 FRL Stores, thereby acquiring indirectly some part of the FRL Retail Business. |
| Secured Creditors to FRL | Dis-approved the acquisition plan of RIL | Secured creditors like “Bank of India” and “State Bank of India” voted to disapprove the Acquisition proposal, as high hair-cut rate was expected. |
| RIL | Denied to Buy FRL Group | RIL declared ‘no-acquisition’ citing an un-trust vote by Secured Lenders, even when FR Group shareholders voted for the acquisition. |
| BOI | Insolvency Petition filed with NCLT | Insolvency petition filed against the FR Group by Bank of India(BOI) for taking a better Resolution plan as per the Insolvency and Bankruptcy Code (IBC) passed by parliament in 2016. |
| NCLT | FR Group gets time to review | NCLT provided time to FR Group till May 12 to submit its reply to the insolvency petition filed by BOI |