Motilal Oswal: Reliance  Acquires Future Group’s Retail Formats; Grows Its Strength In Indian Retail Sector  
A shopper walks through an aisle displaying personal care goods at a Big Bazaar hypermarket, operated by Future Retail Ltd., in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Motilal Oswal: Reliance Acquires Future Group’s Retail Formats; Grows Its Strength In Indian Retail Sector  

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Motilal Oswal Report

In a deal that could well shape the Organized Retail sector in India, Reliance Industries Ltd., through its retail subsidiary, Reliance Retail Venture Ltd. (RRVL), announced the acquisition of Future Group Ltd.’s Grocery and Apparel Retail formats on slump-sale basis at Rs 247 billion.

The deal’s equity value stood at 56 billion, implying the absorption of Rs 191 billion liabilities.

As per our understanding, the deal is likely to be structured in three steps -

1. All of Future Group’s businesses would be transferred to Future Enterprises Ltd. (FEL).

2. Reliance Industries would then acquire the Grocery and Apparel Retail assets from FEL for Rs 247 billion.

3. FEL would retain the FMCG and Apparel brands, the Future Generali Insurance joint venture, and select real estate assets in which Reliance Industries would take an additional 13% stake in two parts for Rs 28 billion.

Click on the attachment to read the full report:

Motilal Oswal RIL Company Update.pdf

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