Future group cos defer shareholder, creditors meetings for RIL deal approval

By: |
November 08, 2021 9:48 PM

The Mumbai Bench of the National Company Law Tribunal (NCLT) on Monday directed Future group firms that "no meeting to be held until final order is pronounced on the applications", said regulatory filings by the Future group firms, including Future Retail, Future Enterprises, Future Lifestyle Fashions and Future Supply Chain Solutions.

Amazon is contesting Future Retail-RIL dealMeanwhile, e-Commerce major Amazon, which is contesting the deal, had also filed an application praying for dismissing the application for conducting the meetings.

Future group firms on the direction of the NCLT have deferred meetings of their respective shareholders and creditors, called on November 10 and 11, for seeking approval for the proposed merger into Future Enterprises as part of the Rs 24,713 crore deal with Reliance Retail, according to regulatory filings.

The Mumbai Bench of the National Company Law Tribunal (NCLT) on Monday directed Future group firms that “no meeting to be held until final order is pronounced on the applications”, said regulatory filings by the Future group firms, including Future Retail, Future Enterprises, Future Lifestyle Fashions and Future Supply Chain Solutions.

Pursuant to the representation received from its secured Creditor, Future group firms along with the other transferor companies forming part of the Rs 24,713 crore deal had filed an application before the NCLT praying to reschedule the dates for convening the meetings.
The application was heard by NCLT on Monday, it added.

Meanwhile, e-Commerce major Amazon, which is contesting the deal, had also filed an application praying for dismissing the application for conducting the meetings, it added.

“On hearing the parties at length, the NCLT has reserved the said application as well as the application filed by Amazon for orders. However, the NCLT has directed that no meeting be held until the final order is pronounced on the applications,” the Future group firms said.

Accordingly, the meetings “are deferred under the directions of the NCLT and would not be conducted as per their earlier respective schedules,” they informed.

Earlier on October 11, several listed transferor firms including Future Retail, Future Consumer, Future Enterprises, Future Lifestyle Fashions, Future Markets Networks and Future Supply Chain Solutions – had informed their shareholders and creditors about the proposed meetings on November 10 and 11.

The scheme of arrangement between Future and Reliance Retail, announced in August last year entails consolidation of Future Group’s 19 companies operating in retail, wholesale, logistics and warehousing assets into one entity — Future Enterprises Ltd.

Future Enterprises Ltd is the transferee company to Reliance Retail.

The meeting was called as per the order passed by the NCLT on September 28, that had asked Future group to take approval from its shareholders and creditors over the scheme of arrangement.

In August last year, Reliance Retail Ventures Ltd, a subsidiary of Reliance Industries Ltd had said it will acquire the retail and wholesale business, and the logistics and warehousing business of Future Group for Rs 24,713 crore.

Amazon is contesting the deal through its shares in FCPL and had approached Singapore International Arbitration Centre (SIAC).

In October 2020, an interim award was passed by the EA (emergency arbitrator) in favour of Amazon that barred FRL from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party.

This was also upheld by SIAC last month and said FRL is a party to the ongoing arbitration between Amazon and Future group in the dispute over the sale of its assets to Reliance Retail.

Moreover, in a separate filing Future Retail Ltd also informed that it has filed a Special Leave Petition before the Supreme Court against an interim order passed by the High Court of Delhi in an arbitration appeal filed by the company.

On Sunday, the independent directors of Future Retail approached the Competition Commission of India (CCI) urging it to revoke the approval it had given to the Amazon Future Coupons Pvt Ltd (FCPL) deal in 2019, alleging the e-commerce major of “making false statements before it”.

In November 2019, CCI had given its approval for Amazon to acquire a 49 per cent stake in FCL. FCL is a shareholder in Future Retail Ltd.

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