Mukesh Ambani-led Reliance Industries (RIL) is reportedly close to inking a deal that would give the conglomerate a controlling stake in the retail businesses of Kishore Biyani's Future Group.
According to the deal, Biyani will relinquish control over all businesses under the Future Retail basket (comprising FBB, Big Bazaar, Food Hall and Central), Future Lifestyle Ltd, and Future Supply Chain Solutions.
All three entities will be merged and the combined business will be acquired by RIL. Biyani will be left with control of Future Group's FMCG business and some other smaller group companies, according to a report in the Times of India.
Discussions between RIL and Future Group are reportedly at an advanced stage, and RIL wants to sign the final deal before the upcoming AGM (Annual General Meeting on July 15. But both companies are still deliberating on the finer points of the deal.
Negotiations on the deal began earlier this year as one of Biyani's holding entities defaulted on the loan payment.
According to several news reports earlier, Biyani, once the poster boy of India's retail sector, held several discussions with many other potential investors as well.
"It is likely to be a complex transaction as, first, Future Group will announce a scheme of arrangement to merge into one company. RIL is most likely to completely buy out this combined entity in exchange for it's shares," a source in the know of the matter told the news daily.
Future Retail has around 1,500 retail stores across several formats, comprising brands like Big Bazaar, Ezone, Foodhall, Fashion at Big Bazaar (FBB), Nilgiris and Easyday. Meanwhile, Future Lifestyle has 300 stores under brands such as Central and Brand Factory.