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Future Retail Insolvency: Expression of Interest invited from potential buyers by October 20

Operational creditors of Future Group firm have filed claims worth Rs 2,464.41 crore

New Delhi:

The Resolution Professional of Future Retail Limited (FRL) has invited ‘Expression of Interest’ from potential buyers as part of the ongoing Corporate Insolvency Resolution Process (CIRP).

All interested and eligible Prospective Resolution Applicants (PRAs) for FRL are required to submit an expression of interest for the resolution plan by October 20, 2022.

The resolution professional (RP) will release the final list of PRAs on November 6, 2022, and the deadline for submission of resolution plans has been set as December 6, 2022, as per the invitation to submit ‘Expression of Interest’. Released by RP of Future Retail.

However, it added that the timelines for completion of CIRP of FRLs under the Insolvency and Bankruptcy Code (IBC) 2016 are “subject to modification by the CoC and any extension/exclusion of the timelines”.

The PRA should have a minimum net worth of Rs 100 crore with minimum asset management (AUM)/committed funds available for investment of Rs 250 crore.

As per the invitation, FRL currently has access to 302 leased retail stores spread across 23 states and union territories, including 30 large format stores such as Big Bazaar and FBB stores and 272 small format stores.

The workforce of FRL has also come down significantly. As per the FY21 annual report, FRL had 21,839 employees in head offices, zonal offices, retail stores, design houses and data centers across the country.

“However, the Aadhaar details received from the corporate debtor, we have been informed that the corporate debtor had 2,242 employees during August 2022,” the invitation said.

The Mumbai Bench of the National Company Law Tribunal, while admitting a petition filed by Bank of India on July 20, had directed the initiation of CIRP against FRL.

A CIRP is required to be completed within a time limit of 180 days from the date of entry of the application under Section 12(1) of the IBC. However, under the request of the RP, the NCLT may extend the period for a further 90 days.

This must be completed mandatorily within 330 days, which includes any extension and time taken for legal proceedings.

As of September 2, 2022, the RP has received claims of Rs 21,432.82 crore from financial creditors, which mainly include banks and financial institutions. Of this, claims of Rs 18,007.48 crore are verified and the remaining claims of Rs 3,425.34 crore are unverified.

According to documents uploaded on the FRL website, operational creditors of the Future Group firm have made claims of Rs 2,464.41 crore.

In addition, it has also received claims of Rs 55.13 crore from workers/employees for their dues. The RP has also received claims of Rs 58.36 crore from statutory operational creditors, such as ESIC, VAT and GST departments.

FRL was part of 19 group companies operating in the retail, wholesale, logistics and warehousing segments that were to be transferred to Reliance Retail as part of the Rs 24,713 crore deal announced in August 2020.

The deal was canceled in April by billionaire Mukesh Ambani-led Reliance Industries Ltd. After that FRL made several defaults in payment.

(Except for the title, this story has not been edited by NDTV staff and is published from a syndicated feed.)


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