Last updated: 30 Aug, 2020 | 09:56 am
Contours of the deal
The deal is structured in 3 parts.
Part 1- Consolidation of businesses: Listed entities of Future Group i.e., Future Retail Ltd., Future Lifestyle Fashions Ltd., Future Consumer Ltd., Future Supply Chain Solutions Ltd, Future Market Networks Ltd. will merge into Future Enterprises (FEL).
Part 2- Slump Sale: 'Future Enterprises will sell the retail and wholesale business that includes key formats such as Big Bazaar, fbb, Foodhall, Easyday, Nilgiris, Central and Brand Factory to Reliance Retail by way of a slump sale. The total value of the slump sale will be Rs 24,713 crore.'When a business is sold for a lump sum consideration without values assigned to individual assets and liabilities, it is called a slump sale.
Part 3: An additional investment by Reliance Retail totalling to ₹2,800 as follows:
Benefits for Reliance Retail from the deal
Benefits for Future Retail
Consensus recommendation on Reliance Industries: Buy (Based on view of 33 analysts from external research institutions)