Reliance Industries Limited and The Future Group are reportedly close to a deal that will see them buying some stakes of The Future Group. This deal can be made and announced before the end of this month or early in the next month. This deal will reportedly give Mukesh Ambani, the chairman of Reliance Industries Limited more control of the retail sector in the country and it will boost the company’s e-commerce ventures. Mukesh Ambani, the richest man in India is all set to buy stakes in some units of The Future Group. Reliance investing in The Future Group will also benefit its own retail units.
The Future Group was founded in 1987 as ‘Manz Wear Private Limited’ and its headquarters are based in Mumbai, Maharashtra. The CEO of the company, Kishore Biyani has previously sold shares of the company when they had been under debt when he sold ‘Pantaloons’ which is a leading clothing retail chain to Aditya Birla Nuvo Limited nearly eight years ago. ‘Pantaloons’ was the first brand under the Future Group back in 1987. Since then, The Future Group has founded many big retail stores under its name such as Big Bazaar, FBB and many others.
The Future Group has 4 main units. According to reports, Reliance will invest primarily in the stakes of the Retail units. But the deal may also possibly see the sale of the stakes of the other units as well. These 4 units are:
The retail unit of this company has the leading retailers of the country. This unit includes brands such as Big Bazaar, FBB, Brand Factory and many more.
This unit includes top FMCG (Fast-Moving Consumer Goods) brands of the country. Brands included in this unit are Golden Harvest, Tasty Treat, Think Skin and others.
Many leading Fashion brands on India are associated with The Future Group. This unit includes many big brands such as Lee Cooper, Converse, Buffalo, etc.
This unit of the company comprises of leading home care brands of India such as Laura Ashley, Wellberg, etc.
Why does The Future Group want to sell its shares?
This deal would help Kishore Biyani, CEO and founder of The Future Group, to pay off the company’s debts. Some reports also say that The Future Group is considering other investors as well, with Azim Premji’s Wipro as the top candidate, which is looking forward to increasing its currently owned stakes of The Future Group.
Why Reliance is investing in The Future Group
Ambani’s plan is to battle top e-commerce companies in India such as Flipkart, which was bought by Walmart around 2 years ago, and Amazon, which already holds a stake in the company. This deal will greatly benefit the sales of Reliance’s retail unit on online as well as its offline stores. Reliance Industries Limited, which received investments worth billions of dollars for Reliance Jio a short time ago from investors such as Facebook, are looking to expand their business in many fields and this deal will greatly impact them in the e-commerce and retail field.