Future Retail claims shareholders’ meet for RIL deal is legal

NEW DELHI: Big Bazaar-parent Future Retail (FRL) on Friday said the meetings of its shareholders and creditors that are scheduled to be held on April 20 and 21 for the approval of its proposed deal with Reliance Retail are “legal” and conform to the directions issued by the National Company Law Tribunal (NCLT).

The regulatory filing by the Kishore Biyani-led entity comes in the wake of a warning by Amazon which wants to block the deal. Earlier this week, US retailer shot off a letter to FRL’s promoters alleging that the meetings are “illegal” due to injunctions granted by a Singapore-based emergency arbitrator which had put the Rs 24,700-crore proposed deal on hold.

“We reiterate that the above meetings have been convened in compliance of the directions given in the order dated 28th February 2022 issued by Hon’ble NCLT to consider and approve the Composite Scheme of Arrangement filed by various entities, who are part of the scheme,” said FRL in a regulatory filing.

The debt-ridden retailer’s response comes a day after its biggest lender, Bank of India (BOI) started insolvency proceedings against the company after plans for a one-time restructuring failed. FRL is entangled in a bitter legal battle with Amazon over the sale of its assets to Reliance. Amazon has contended in various courts that FRL has breached a contract by entering into an arrangement with Reliance.

The e-tailer had invested in Future Coupons in 2019. The unlisted Future Group entity held a stake in flagship FRL and Amazon believes that its investment gives it protective rights over FRL.

“As regards, the voting on resolutions by concerned shareholders of the Company, we would like to inform that the same is a right available to all the shareholders of the Company and if any one of them is restricted due to any contractual obligation entered into by them as part of private arrangement, the same would not affect the proceedings of the meetings convened as per the aforesaid direction, in any manner,” FRL wrote in its regulatory filing.

In February, Reliance Reliance moved in to take control of a majority of FRL’s stores due to non-payment of rentals as it had sublet the premises to FRL.