Tue. Jun 25th, 2024
Amazon, Future Retail ( FRL)

Consumer goods company Future Retail Ltd (FRL) moved to the Supreme Court of India, urging it to pass directions stopping its lenders from announcing the company as a non-performing asset (NPA) in case it fails to pay Rs 3,494.56 crore, reported PTI. 

Earlier this month, Future Retail had informed about defaulting on the payment of Rs 3,494.56 crore to banks and lenders as it failed to sell its assets owing to the online litigation battle with Amazon it is locked in. It has impacted monetisation plans. Though the company still has the window to pay the debts till the end of this month.

An urgent petition was passed on Tuesday by FRL, requesting the apex court to issue a “direction restraining Respondent Nos.2-28 (lenders) from declaring the Petitioner No 1 (FRL) as a Non-Performing Asset.”

Further, the Future group firm has requested for granting more time to pay off debts and urged the Supreme Court to “extend the timeline stipulated under the Framework Agreement for monetization of the Small Format Stores in line with the minutes of the meeting dated 01.01.2022.”

Also, it asked the court to issue orders to its lenders “to extend the “cure period”/ “review period” of 30 days under the Framework Agreement” and provide some relaxation in the time frame. 

Future Retail, also asked judges to revoke default notices it had got from its lenders, including the State Bank of India, raising an action against the company warnings, as per Reuters.  

FRL received a 30-day review period (starting January 1, 2022) after failing on the payments on the due date (December 31, 2021), as per the RBI circular dated August 6, 2020, on the one-time restructuring (OTR) programme for COVID-19 impacted companies.

FRL, last year, became a part of an OTR scheme for COVID-19 hit companies with a consortium of banks and lenders and was obliged to discharge “an aggregate amount of Rs 3,494.56 crore” on or before December 31, 2021, for that.

In August last, the Future group had declared a Rs 24,713-crore worth deal for transferring its retail and wholesale business and the logistics and warehousing business to Reliance Retail Ventures Ltd, a subsidiary of Reliance Industries Ltd.

However, US e-commerce giant Amazon is opposing the deal via its 49 per cent stake in Future Coupons Pvt Ltd (FCPL), which has a stake in Future Retail.

Also Read: Amazon Tells Future Retail: Samara Capital Ready To Buy FRL Biz For Rs 7K Cr

The matter is going on in the Supreme Court and Singapore International Arbitration Center (SIAC).

Reliance Retail Ventures, yet another time, has dragged its timeline for fulfilling its Rs 24,713-crore deal with Future group to March 31, 2022, as it still awaits regulatory and judicial clearances.

( References: PTI, Reuters)

By Harshita Sharma

I bring to you updates from business, policy and economy spectrum.

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