Reliance, Samara eye Future’s assets
MUMBAI: Several suitors, including Reliance Retail Ltd and private equity firm Samara Capital, are in advanced talks to buy a stake in Kishore Biyani’s Future Retail Ltd, which runs the popular BigBazaar supermarket stores, said two people aware of the development.
“There are a couple of other investors, too, that are in the fray. The deal is in advanced stages of discussion and the group is trying to close the transaction within this month,” said one of the people on condition of anonymity. If Future group chooses to sell to a strategic investor, Biyani may have to give up control of the company he founded, the second person said.
Biyani’s debt-related woes surfaced in March when shares of his listed firms plunged, triggering a rating downgrade of the promoter holding firm and invocation of pledged shares by lenders. The stake sale will help the group pare its large debt.
“If they (the promoters) are able to bring in a financial investor that helps solve their problems, then the promoters might still continue in the business.
But if they strike a deal with a suitor like Reliance, then the promoters will have to give up control,” he said.
While Samara is eyeing a stake in Future Retail, a possible deal with Reliance could also involve the group’s apparel retail business Future Lifestyle Fashion Ltd, the person added.
An email sent to Future Group remained unanswered. Samara Capital declined to comment.
“As a policy, we do not comment on media speculation and rumours. Our company evaluates various opportunities on an ongoing basis,” a spokesperson for Reliance Industries said.
Samara, in partnership with US e-commerce giant Amazon.com Inc., owns supermarket chain More. Amazon is also an existing investor in Future Retail, through its investment in promoter group company Future Coupons.
On May 4, Icra downgraded Future Corporate Resources, a promoter group entity, to D, after it defaulted on coupon payments.
“The firm informed it has sought a moratorium from investors; however, the same has not been approved,” Icra said.