NEW DELHI: Future Group promoter Kishore Biyani is plotting a comeback in retail space by selling some assets and repaying part of debt even as his flagship company Future Retail (FRL) faces bankruptcy proceedings in the wake of the Rs 25,000-crore Future-Reliance deal falling through.
Discussions are on at the Mumbai-headquartered conglomerate to salvage several Future Group companies such as Future Enterprises (FEL), Future Lifestyle (FLL), Future Consumer and Future Supply Chain through a combination of debt restructuring and sale of key assets, said three people briefed on the matter.
The demise of the proposed Future-Reliance deal also means that Biyani, once hailed as the Sam Walton of India, is out of the anti-compete clause that barred him and his family members from re-entering the retail space for a period of 15 years.
“Out of the roughly Rs 29,000 crore debt owed by the group, FRL owes around Rs 18,500 crore, while FEL owes Rs 5,500 crore. The Future Generali sale is generating around Rs 3,000 crore, which will be used to partly pay off FEL’s dues,” said a source.
FEL is into manufacturing and supply of fashion garments to the group’s outlets under FLL, which houses brands such as Central and Brand Factory. While Reliance Industries (RIL) has taken control of over 800 stores of the group over non-payment of rentals, Biyani is left with 250 stores comprising Central, Brand Factory, ALL and others, which he plans to revive, said sources.
“The group is planning to sell the ALL chain, which is into plus size clothing, for around Rs 1,000 crore. Sale of the Cover Story brand is generating around Rs 250 crore. These proceeds will be used to partly pay FLL’s dues, which is pegged at around Rs 2,500 crore,” said a source. “Banks, however, will need to take a call on the restructuring.”
The remaining companies, Future Consumer, which owns brands such as Foodpark, CareMate and Desi Atta and the group’s logistics arm Future Supply Chain have a combined debt of around Rs 1,700 crore. While a Future Group spokesperson did not respond to TOI’s queries, a person familiar with the developments said the two companies are asset heavy and boast good business continuity prospects.
On April 23, RIL called off the Future-Reliance deal, as a majority of secured lenders to the Big Bazaar parent voted against the takeover.
Discussions are on at the Mumbai-headquartered conglomerate to salvage several Future Group companies such as Future Enterprises (FEL), Future Lifestyle (FLL), Future Consumer and Future Supply Chain through a combination of debt restructuring and sale of key assets, said three people briefed on the matter.
The demise of the proposed Future-Reliance deal also means that Biyani, once hailed as the Sam Walton of India, is out of the anti-compete clause that barred him and his family members from re-entering the retail space for a period of 15 years.
“Out of the roughly Rs 29,000 crore debt owed by the group, FRL owes around Rs 18,500 crore, while FEL owes Rs 5,500 crore. The Future Generali sale is generating around Rs 3,000 crore, which will be used to partly pay off FEL’s dues,” said a source.
FEL is into manufacturing and supply of fashion garments to the group’s outlets under FLL, which houses brands such as Central and Brand Factory. While Reliance Industries (RIL) has taken control of over 800 stores of the group over non-payment of rentals, Biyani is left with 250 stores comprising Central, Brand Factory, ALL and others, which he plans to revive, said sources.
“The group is planning to sell the ALL chain, which is into plus size clothing, for around Rs 1,000 crore. Sale of the Cover Story brand is generating around Rs 250 crore. These proceeds will be used to partly pay FLL’s dues, which is pegged at around Rs 2,500 crore,” said a source. “Banks, however, will need to take a call on the restructuring.”
The remaining companies, Future Consumer, which owns brands such as Foodpark, CareMate and Desi Atta and the group’s logistics arm Future Supply Chain have a combined debt of around Rs 1,700 crore. While a Future Group spokesperson did not respond to TOI’s queries, a person familiar with the developments said the two companies are asset heavy and boast good business continuity prospects.
On April 23, RIL called off the Future-Reliance deal, as a majority of secured lenders to the Big Bazaar parent voted against the takeover.
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