17 April 2023, Mumbai
The Mumbai bench of the National Company Law Tribunal (NCLT) has granted Future Retail Ltd (FRL) a 90-day extension until July 15, 2023, to complete its insolvency resolution exercise. This move comes after the NCLT initiated insolvency resolution against FRL on July 20, 2022.
According to the Insolvency and Bankruptcy Code (IBC), the corporate insolvency resolution process (CIRP) must be completed within 180 days, with a one-time extension of 90 days granted by the NCLT. The maximum time given is 330 days, including litigation.
Future Retail stated in a regulatory filing that the NCLT had pronounced an oral order and is awaiting a written order. The deadline for sale was April 16. However, the lenders of FRL had earlier decided to invite fresh bids after dividing the company's assets into clusters, with bidders being able to bid for the entire company or specific clusters.
Earlier this week, Future Retail said that 49 entities, including Reliance Retail and the Adani group, had submitted expressions of interest (EoI) for acquiring its assets. On March 23, 2023, the resolution professional of Future Retail invited new expressions of interest, as the firm had failed to attract a resolution plan in over four months. Prospective buyers can bid for the debt-ridden firm "as a going concern or individual cluster or a combination of clusters of its assets."
Despite the legal hurdles, FRL has managed to attract interest from several potential buyers, including Reliance Retail and the Adani group.
FRL operates over 1,500 stores in more than 400 cities in India and has a market value of around $1.5 billion.
