Future Retail misses due date for payment of Rs 3,494.56 cr to banks; on the ongoing dispute with Amazon

Future Retail said on Saturday that it missed the due date for the payment of Rs 3,494.56 crore to banks and lenders because it could not sell assets due to its ongoing dispute with amazon , which impacts its monetization plans.

Last year, Future Retail concluded a one-time restructuring program (OTR) for businesses affected by COVID-19 with a consortium of banks and lenders and was due “a total of Rs 3,494.56 crore” to the later than December 31st. 2021.

The Future group company headed by Kishore Biyani “would cooperate to complete the monetization of the specified activity within the next 30 days” in accordance with the banks’ instructions to resolve the current situation, according to a regulatory filing from Future Retail.

Due to pending litigation with Amazon.com NV Investment Holdings LLC, the company has been unable to complete the planned monetization of the specified business as contemplated in the OTR plan to fulfill the aforementioned obligations. to banks / lenders, on the due date. The company has a 30 day review period (from the due date) under the terms of the RBI Circular of 06 August 2020 and further in terms of the provision of the above agreement to effect the payment of the above amount owed to identified bankers / lenders, ” the record reads.

In April 2021, Future Retail’s lenders approved the restructuring of the company’s existing financial debt as part of a resolution framework announced by the RBI for stress related to COVID-19.

Said restructuring had covered FRL’s demand for working capital, loans, term loans, cash loans, short-term loans, NTMs, voucher discount limits, other loans. working capital and unpaid interest, which have become past due.

There were 28 banks that loaned money to the group’s distribution company and were part of the exercise, Future Retail had informed in April last year to the stock exchanges after getting approval.

After the exercise of the loan structure, Future Retail expected a recovery on schedule.

In August 2020, Future Group announced a Rs 24,713 crore deal to sell the retail and wholesale business, as well as logistics and warehousing business to Reliance Retail Ventures Ltd, a subsidiary of Reliance Industries. Ltd.

However, e-commerce giant Amazon is challenging the deal through its 49% stake in Future Coupons Pvt Ltd (FCPL), which is a shareholder of Future Retail.

The case is currently before the Supreme Court and the Singapore International Arbitration Center (SIAC).

Reliance Retail Ventures had for the second time extended the deadline to complete its Rs 24,713 crore deal with the Future Group until March 31, 2022, as it is still awaiting regulatory and judicial clearances.

In October 2020, an interim ruling was issued by the EA (the emergency arbitrator) in favor of Amazon which prohibited FRL from taking any action to dispose of or encumber its assets or issue securities to secure a financing of a small part.

This was also confirmed by SIAC last month and said FRL was a party to the ongoing arbitration between Amazon and Future Group in the dispute over the sale of its assets to Reliance Retail. In the deal, the Competition Commission of India (ICC), in an unprecedented move, reconsidered its more than two-year approval for Amazon to acquire a stake in Future Coupons, through which the global major du e-commerce claims rights to Future. Retail.

On December 17, the ICC suspended its approval for Amazon’s deal to acquire a stake in Future Coupons Pvt Ltd and also imposed a penalty of Rs 202 crore on the e-commerce company for certain tickets.

(With PTI entries)

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Posted on: Sunday January 02, 2022 19:56 IST

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