Reliance Retail, a subsidiary of Reliance Retail Ventures (RRVL), has issued notices to terminate sub-leases of 947 Future Group stores. The company plans to reopen them after reconciling stock and inventory positions and rebranding them.
Reliance had taken over the stores last month as they were sub-leased by it to Future which had defaulted on rental payments. Now, all such stores have been closed by Reliance. Once the reconciling of stock and inventory positions is over, the stores would be rebranded across categories as Reliance Digital, Reliance Smart and Reliance Fresh (groceries), and Reliance Trends. The stores may start reopening after maybe a fortnight.
Sources said talks between Future Group and Amazon to explore the possibility of an out of court settlement over the former selling its retail assets to Reliance Retail may extend beyond March 15, the deadline given by the Supreme Court to both the parties. It is likely that both the sides may seek an extension of the deadline from the SC at the next hearing.
Amazon has been objecting to the sale on the ground that it has a first right of refusal over Future Group’s retail assets as per a 2019 deal it struck with a group entity.
Future Retail said in a regulatory filing on Thursday it has received termination notices for 342 large format retail (LFR) stores – including Big Bazaar, Fashion at Big Bazaar (fbb) and 493 small format retail stores such as easyday and Heritage stores.
Further, another group company Future Lifestyle Fashions said it received termination notices for 34 ‘Central’ stores and 78 ‘Brand Factory’ stores. These stores – LFR, small retail, ‘Central’ and ‘Brand Factory’ — have been contributing about 55-65% of the company’s total retail revenue from operations.
Future Retail is in “continuous discussions” with Reliance group to maintain status quo and for safeguarding the interest of various stakeholders, it said, adding that as of now these stores are not operational for stock and inventory reconciliation.
Reliance Retail plans to also absorb the entire 30,000 staff of Future Retail and Future Lifestyle, including the employees of the remaining 1,200 stores. Future Retail and Future Lifestyle together has 1,700 stores, including the popular Big Bazaar stores, across the country.
Reliance Retail operates more than 12,000 stores in the country. RRVL is a wholly-owned subsidiary of RIL.
The dispute between Future Group and Amazon has been raging since October 25, 2020, when the Singapore’s emergency arbitrator restrained Future Retail from going ahead with its Rs 24,500-crore deal with Reliance Retail.