Shares Of Future Group Firms Plunge Up To 20 Per Cent As Reliance Calls Off Deal

Future, once one of India's biggest retailers, now faces the prospect of a bankruptcy process with Reliance calling off the deal

Future’s secured creditors, namely banks and financial institutions, of the listed firms, rejected the deal with Reliance as it did not obtain the required 75 per cent clearance in the vote. Image: Getty

Source : Future Retail Getty

New Delhi: Shares of Kishore Biyani-led Future Group companies’ on Monday tanked as much as 20 per cent after Reliance called off its Rs 24,713-crore deal with the group over the weekend, according to a report by Reuters.

This move by the country’s biggest retailer, Reliance, has pushed Future Retail towards a possible bankruptcy process.

On Monday, shares of Future Supply Chain Solutions, Future Retail, Future Lifestyle Fashions, Future Consumer, and Future Enterprises fell between 5 per cent and 20 per cent.

Deepak Shenoy, founder and chief executive of Capitalmind in Bengaluru, said, “There is nothing much left for the company (Future Retail). They don't have money, shops. Whatever Reliance has not taken over yet have already been shut down. Future Retail is likely to file for bankruptcy.”

Future’s secured creditors, namely banks and financial institutions, of the listed firms, rejected the deal with Reliance as it did not obtain the required 75 per cent clearance in the vote.

On Saturday, Reliance said the deal, which is at the centre of many legal conflicts since 2020, hence, cannot be implemented.

Future Group has been entangled in a long-drawn legal conflict with US e-commerce major Amazon over the $3.4-billion sale of its retail assets to rival Reliance Industries.

The US e-tailer had obtained legal injunctions that stopped Future’s deal with Reliance. This has sparked a series of legal battles in various forums, including an arbitration panel in Singapore.

Reliance, which had been in the shadows through the dispute between Future and Amazon, in February took control of hundreds of Future stores citing non-payment of rent by Future Group.