Lenders are betting on Reliance Retail Ventures, a RIL subsidiary, to acquire bankrupt Future Enterprises to recover part of their Rs 15,820 crore exposure to the company.
Lenders say RRVL, if its offer is accepted, will get access to two insurance JVs which are currently owned by Future Enterprises with Generalli which gels with RIL’s financial services business.
Apart from RRVL, Jindal India and GBTL Ltd, a fabric maker, have also made offers for Future Enterprises. “RRVL, with its good financial backing and $111 billion valuation is best placed to acquire FEL,” said a banker, asking not to be quoted.
Bank of Baroda had made a claim of Rs 1,908 crore but of this only Rs 701 crore admitted by the resolution professional (see chart).
In August 2021, Reliance Retail had made an offer to the banks to acquire all the assets of Future group companies for Rs 24,700 crore. But the lenders did not agree to the transaction and sent several Future group companies for debt resolution under the insolvency and bankruptcy code, 2016.
Future Enterprises owns minority stakes in two insurance companies — Future Generali India Life Insurance Company,
and Future Generali India Insurance Company.
If RRVL wins the race to acquire FEL, then it will own minority stakes in both the joint ventures.
Reliance has recently demerged its financial services business which was listed at an valuation of $20 billion. The company wants to enter all the verticals of financial services including insurance.com.
Reliance has been unlocking value across segments and has recently bought out minority shareholders in Reliance Retail (RR) with a share buyback. The company is in negotiations with Qatar Investment Authy to sell 1 per cent stake in RRVL at a $100 billion valuation.
In 2020, RRVL had sold stake sales of 10 per cent to various financial investors. RIL and its associate companies currently own 90 per cent stake in the company.