InvestorQ : Can you explain the gist of the deal between Reliance and the Future Group?
Chandralekha Desai made post

Can you explain the gist of the deal between Reliance and the Future Group?

Answer
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diksha shah answered.
3 weeks ago


Finally, the much talked about deal between Reliance Retail, part of Reliance Industries, and the Future Group was sealed over the week end. As part of the deal, Reliance Retail will pay Rs.24,700 crore in cash for the deal, but this will include the assumption of debt.

However, before the execution of the deal, all the group companies will be merged into Future Enterprises Ltd. Each of the Future Group companies will get a proportionate stake in FEL and then the stake in FEL will be sold to Reliance Retail Ventures as part of the deal.

Once the deal is done and dusted, the Future group will merely retain the FMCG business and the insurance business and transfer the rest of their customer facing businesses to Reliance Retail. It will make RIL a formidable player in the retail space post the deal.

To an extent, this brings to an end the retail story of the Biyani group that began 33 years ago in 1987. Biyani had dreams of building the Indian version of Wal-Mart but that was not to be as online commerce and real-estate lock-in costs proved to be too prohibitive.