India’s second-largest retailer, Future Retail Limited
has suspended most of its online and offline operations as stores remained
closed on Sunday after rival Reliance offered to take over its flagship supermarkets
for missed lease payments, reported PTI.
Kishore Biyani-led Future Group stores are now being re-branded as the
Reliance stores. Reliance has taken over 200 Future Group stores and is in the
process of transferring more than 30,000 Future Retail and Future Lifestyle
employees over to its manpower and staffing firm called Reliance MSL, sources
told Reuters on Saturday.
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The debt-ridden retail chain has more than 1,700 outlets
across various brands including Big Bazaar, fbb and Central. In 2020 Reliance
has started to terminate the lease agreements with Future Group.
received termination notices for a significant number of stores due to huge
outstanding payments, and it would no longer have access to such store
premises, the company said in a stock exchange filing. Reliance had transferred
leases of some Future stores to its name and sub-leased them to Future.
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“The company is scaling down its operations which will
help us in reducing losses in the coming months. The company is proposing to
expand its online and home delivery business, to increase its reach to the
customers,” it added. The company reported a loss of Rs 4,445 crore in the last
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Future’s stores across India remained closed as Reliance
did stock-taking ahead of a rebranding, reported PTI.
When a Twitter user complained about closure Big Bazaar
informed that the current stores are non-operational for 2 days. Its e-commerce
mobile app and website were also unavailable for online trading.
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Reliance’s takeover holds significance as it follows
failed efforts since 2020 to close a $3.4 billion acquisition deal for retail
assets of Future whose partner Amazon.com Inc has blocked the transaction
citing violation contracts by Future. Amazon has long argued that Future
violated the terms of a 2019 deal in which the US company invested $200 million
in the Indian company. Amazon’s position has been supported so far by a
Singapore arbitrator and Indian courts.