India’s Future Enterprises Ltd is all set to finalise the sale of the group’s retail business to Mukesh Ambani-led Reliance Industries Ltd’s retail arm on Saturday. The deal, reportedly in the works for months now, has been valued at about 290-300 billion rupees ($3.92-$4.06 billion), according to various media reports. Sources say that Reliance will take on Future Group’s debt and liabilities and pick up a minority stake in its consumer arm.
The Group will merge five listed units across grocery, apparel, supply chain and the consumer business into Future Enterprises, which will then hive off all retail assets and sell them to Reliance as a single unit, the report said.
Future Group and Reliance did not immediately respond to Reuters’ requests for a comment.
Future Enterprises had said earlier this week it would meet on Saturday to consider proposals to raise funds through an issue of bonds.
Owned by India’s “father of modern retailing”, Kishore Biyani, Future Group is home to supermarket chain Big Bazaar, upmarket food stores Foodhall, and bargain clothing chain Brand Factory.
Reliance which is led by Asia’s richest man Mukesh Ambani, has been diversifying its business and ramping up a retail presence recently. It launched an online grocery service JioMart in May, a move rivalling Amazon.com Inc and Walmart Inc Ltd’s Flipkart in India, a key growth market for e-commerce.
Infact the news about the company being in talks to buy online furniture company Urban Ladder and milk delivery startup Milkbasket to strengthen its e-commerce business was viral earlier this moth.
The deal being finalized, shares in Future Enterprises Ltd jumped 5% and hit an upper price.