The resolution professional of Future Retail Ltd (FRL) has invited ‘expression of interest’ from prospective buyers under the ongoing Corporate Insolvency Resolution Process (CIRP).
All interested and eligible prospective resolution applicants (PRA) for FRL are required to submit an expression of interest for the resolution plan by October 20, 2022.
The resolution professional (RP) will issue the final list of PRAs on November 6, 2022, and a deadline of December 6, 2022, has been fixed for the submission of resolution plans, according to the ‘Invitation to submit ‘expression of interest’ issued by RP of Future Retail.
However, it added that the timelines “remain subject to modification by the CoC and any extension/exclusion to the timelines” for completion of CIRP of FRL under the Insolvency & Bankruptcy Code (IBC) 2016.
PRAs should have a minimum tangible net worth of Rs 100 crore along with minimum assets under management (AUM)/committed funds available for investment of Rs 250 crore.
As per the invitation, FRL currently has access to 302 leased retail stores spread across 23 states and Union territories, consisting of 30 large format stores such as Big Bazaar and FBB stores and 272 small format stores.
FRL’s employee strength has also gone down substantially. According to the FY21 annual Report, FRL had 21,839 employees at head office, zonal offices, retail stores, design houses and data centre’s across the country.
“However, basis details received from the Corporate Debtor, we have been informed that the Corporate Debtor had 2,242 employees during August 2022,” the invitation said.
The Mumbai bench of the National Company Law Tribunal had on July 20 directed to initiate CIRP against FRL admitting a plea filed by Bank of India.
Section 12 (1) of IBC mandates a CIRP to be completed within a time frame of 180 days from the date of admission of the application. However, under the request of the RP, the NCLT can extend the duration for another 90 days.
It should be mandatorily completed within 330 days, including any extension and the time taken in legal proceedings.
As of September 2, 2022, the RP has received claims of Rs 21,432.82 crore from financial creditors, which mainly include banks and financial institutions.
Of this, Rs 18,007.48 crore worth of claims are verified and the rest of Rs 3,425.34 crore are unverified.
Operational creditors of the Future group firm have filed claims worth Rs 2,464.41 crore, according to the documents uploaded on the FRL website.
Besides, it has also received claims worth Rs 55.13 crore from workmen/ employees for their dues. The RP has also received claims from statutory operational creditors, such as ESIC, VAT and GST departments of Rs 58.36 crore.
FRL was part of the 19 group companies operating in retail, wholesale, logistics and warehousing segments, which were supposed to be transferred to Reliance Retail as part of a Rs 24,713-crore deal announced in August 2020.
The deal was called off by the billionaire Mukesh Ambani-led Reliance Industries Ltd in April. After that FRL committed several defaults on payments.
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